Attitudes Towards Inheritance Taxation – Results from a Factorial Survey

• In Event: 493 - Regular Session. How Do the Rich Get Richer?

Abstract

As intergenerational transfers become more important for the social reproduction of inequality and the accumulation of wealth within families the relevance of a fair inheritance taxation rises. By applying a factorial survey, we examine (a) which dimensions are seen as relevant for a fair proposed inheritance tax rate and (b) which respondent characteristics are associated with a general tendency to favor high or low inheritance tax rates. The relevant dimensions for fair inheritance taxation have been derived by need and equity arguments, whereas the relevant respondent characteristics are assumed to be influenced by the personal situation (expecting a bequest in the future) and a family perspective (individual versus family orientation). The results show that a fair tax rate increases with the value of the bequest, the income of the heir and governmental debt; it decreases with a close relationship between testator and heir and when the asset is a family-occupied house or family enterprise compared to a “lump sum”. Whereas expecting a future bequest does not play a role for favoring a high or low inheritance tax rate in general, people with a high family orientation favor a low inheritance tax rate. Inheritance taxation should therefore account for need, equity and family principles to be seen as fair by the general population and to foster the testators´ and heirs´ tax com-pliance.

Authors

• Christiane Gross, FAU Erlangen-Nuremberg

• Kerstin Lorek, University of Erlangen-Nuremberg

• Friedemann Richter, FAU Erlangen-Nuremberg