Austria eliminated its inheritance tax in 2008
What? Why?
this post was submitted on 15 Mar 2024
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For regular people, an inheritance tax is not great. For the ultra-wealthy it should be mandatory.
Arguments against an inheritance tax:
- Double taxation: Critics argue that inheritance taxes are a form of double taxation, since the assets being inherited have already been taxed once during the decedent's lifetime.
- Hurts small businesses: Family-owned businesses can face hardship if they must be sold off to pay inheritance taxes.
- Discourages investment: Inheritance taxes can disincentivize people from saving and investing, as they know a portion of their wealth will go to the government.
Arguments for an inheritance tax:
- Reduces wealth inequality: Inheritance taxes help to redistribute wealth from the very wealthy to the rest of society, reducing income inequality.
- Prevents concentration of power: By limiting the ability of wealth to be passed on unchecked, inheritance taxes can help to prevent excessive concentration of economic and political power in the hands of a few families.
- Source of government revenue: Inheritance taxes can be a significant source of revenue for governments, which can be used to fund social programs and public goods.
For regular people, an inheritance tax is not great. For the ultra-wealthy it should be mandatory.
Hey good thing (in the US at least), you don't pay a dime of inheritance tax on the first $13.61 million being inherited.
So no "regular people" are paying any inheritance tax whatsoever. Americans have been fooled, again, into rallying against something that has zero direct effect on them.
I learned recently enough that this is because the Reagan administration came up with the (in fairness, an absolutely genius move given their political viewpoint) the great idea of calling it a "death tax".
Thank you for that information. The article is about a German / Austrian woman so I was summarizing the pros and cons of an inheritance tax which might apply to any country since I don't know the specifics of their law or why they changed it it.
Fair enough. Apologies for using that to make a point about the US tax system. Typical American move, amirite?
I wonder who was worth about 13.5 million when this was passed.
I believe it was slightly lower, but Trump raised it (with his tax cut act maybe?)
double taxation
That one always kills me because from the viewpoint of the one inheriting the money, the money hasn't been taxed yet. If you were to treat it like income from a lottery, everyone would agree that taxing it makes sense.
I think this viewpoint assumes that everyone lives independently. A lot of families function as units and they all live and work together. If you inherit post-tax income from a family member, then the money has been fairly taxed regardless of your viewpoint.
Why should you have to pay the government to inherit your late-parent's car or business? What happens if you can't afford to pay the tax?
For the low income families this can make or break a person's way of life, for the 1% it is a way of hoarding the world's wealth and maintain power.
I'm talking specifically about the double taxation point.
Its clear inheritance taxes must be highly progressive or else you are penalizing things like family homes etc. But even still reverse mortgages, business loans, stocks.... All these financial instruments exist.
I agree it needs to be a highly progressive tax. I'm generalizing because we're discussing international tax law and I don't know the income cutoffs for different countries.
Double taxation is a real concern only if the inheritance tax affects very low income individuals. A family who shares a car or a struggling family restaurant might have a very difficult time if they are forced to pay an unexpected tax bill.
1 This is like saying, since you work for your family's business and since the business gets taxed on the profits they use to pay you, that you shouldn't have to pay income taxes.
2 You can ALWAYS pay the tax. Since it's based on the value of the items you inherited, you'd just have to decide which items you're willing to sell to in order to pay the tax.
3 how many low income families do you know of that more that $10 million dollars in assets? >!FUCKING NONE! Because these strawmen don't fucking exist!<
I'm specifically talking about very low income families since I am talking about the general pros and cons of applying an inheritance tax to all citizens since we are discussing why the inheritance tax might have been removed in Austria / German. I'm not familiar with international tax law to be more specific about income levels so I'm trying ro cover all bases.
If a poor family is sharing a car or a family restaurant, it could be very damaging to have to pay tax on these assets if they don't have savings.
I understand that this doesn't apply to families with large assets and I agree that an inheritance tax is generally a good thing when applied progressively.
For the ultra-wealthy it should be mandatory.
Yeah, I was more thinking generational wealth like billionaire kids. It seems crazy not to tax that.
Rich people paid off enough of the legislative.
EDIT: Probably
“I’m just one brain, I’m just one person and so to me, this is a huge relief knowing that the process of redistribution is much more legitimate and thorough and democratic than I could ever do it,” she said in an interview with Bloomberg. “Nobody needs another foundation.”
It's good that someone realizes the problems with it, and also decides to not go for that option, even if it means losing control over the funds.
Also, the altered copy behavior is really annoying. I had to resort to using developer tools to actually copy the text. This is what was inserted when copying the text normally:
“I’m just one brain, I’m just one person and so to me, this is a huge relief knowing that the process of redistribution is much more legitimate and thorough and democratic than I could ever do it,” she...
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Looks like a really interesting project, I hope someone is documenting it to make a documentary or something. The debates are going to be fascinating and honestly there's so much room for drama and division I bet things get either emotionally heated or political
Personally I can't imagine having money to put into something and not having a dozen things I'm passionate about and want to work on. I'd probably invest most in creating an open source citizen science and consumer testing project, employ people to create 3rd party documentation of floss projects as well as data gathering and tool creation for use by open source projects.
I might use it as establishing grants to other groups, like all the passionate people I see doing things being able to say 'I can buy you everything you need to set up properly, pay for you to study the area you're invested in and try to help demo and advertise the solutions you're creating... all I need is you to work on this simple but important community project'
That way they do one thing which improves the floss ecosystem directly and are set up to continue on a whole new level than before. It'd be things that are fairly simple and tailored to their abilities; researching and creating lists, 3d modeling, coding... designing tools that are useful to the central project that others can use and extend. Basically creating resources that allow others to create.
when a company makes a washing machine they start with all sorts of testing and experiments to determine how good the existing options are and to discover the best ways of determining if what they're doing actually works. I'd create an open source platform that makes it easy for people to add knowledge and meaningful data about product design considerations so that anyone designing something has a good starting point and a platform to gather data if there's none already.
Heh little off topic but it illustrates my point, I wonder if the lack of passion for what to do with the money comes from being born rich and just taking money for granted.