Inheritance Tax Research Articles

Does inheritance taxation reform promote to build inexpensive rental housing?

The inheritance taxation reform of 2015 in Japan substantially increased the amount of tax levied on large inheritances. This potentially served as a good incentive for people to build inexpensive low-rise apartments for tax savings, which increased the number of low-cost apartments. Therefore, this study investigates the effect of inheritance taxation reform on housing rents. Using the difference-in-differences method, we reveal that the inheritance taxation reform decreased the housing rents of wooden or light steel-framed apartments by 1.3%. Moreover, our results indicate that while the rental of slightly older housings belonging to the treatment group decreased, the rental of new housing belonging to the treatment group did not change.

Italian Revenue Agency Provides New Guidance on the Taxation of Trusts

In this article, the author examines Circular Letter No. 34/E of 20 October 2022 on certain aspects of the taxation of trusts, which provides guidance on two specific issues, i.e. the tax treatment of “attributions” in favour of subjects resident in Italy from trusts established in “privileged taxation jurisdictions” and the form of application of the inheritance and gift tax in respect of assets transferred to a trust fund.

Macroeconomic effects of family business inheritance tax reduction: Evidence from South Korea

AbstractThis study examines the macroeconomic effects of family business inheritance tax reduction in South Korea using a theoretical model that addresses the problem of a family member's occupational choice decision between being a worker and being an entrepreneur. In contrast with previous studies, the model considers the distribution of firm size. The effect of the reduction in the family business inheritance tax rate on the macroeconomy is positive in this model, whereas it is negative in a model in the literature that does not consider the distribution of firm size when addressing the occupational choice decision. Calibrated results obtained using data for South Korea show that a 50% reduction in the family business inheritance tax rate increases the total labour demand, total real investment, and total sales by 0.13%, 1.88%, and 0.15%, respectively.

Giving to the children or the taxman?: Lessons from a Swedish inheritance tax loophole

Wealth transfer tax systems based on inheritances and inter vivos gifts, rather than estates, allow donors to shift wealth among potential recipients with the goal of minimizing tax burdens. However, tax minimization often requires the donor to give up control over wealth if the transfers are made as inter vivos. Usually, such behavior is difficult to analyze as many potential heirs and many different tax schedules are involved. In this article, we study a simple setting that allows us to obtain transparent and credible evidence of inheritance tax responses. Swedish heirs could easily lower their inheritance tax bills to zero by giving part of the inheritance to their children. Using detailed administrative data, we show that many heirs tax minimized in a precise fashion. Still, among those inheriting just above the exemption, only about a half avoided the tax. Preferences for holding wealth and information seem to play major roles. Our findings have general policy relevance, because similar (but more complex) tax avoidance strategies can be used to avoid any inheritance tax.

Passing the Shareholders’ Tax Burden to the Corporation: Evidence from Inheritance and Gift Tax

Passing the Shareholders’ Tax Burden to the Corporation: Evidence from Inheritance and Gift Tax

Economic justification for Rignano's Inheritance Tax Proposal

Economic justification for Rignano's Inheritance Tax Proposal

중국의 소득불균형 해소를 위한 상속세제 도입 연구

Inheritance tax in China was first implemented during the Republic of China era. At that time, the Nanjing government proposed imposing an inheritance tax and enacted related ordinances, but it was not implemented.
 However, after the Anti-Japanese War broke out on July 1, 1940 and the national finances were in crisis, inheritance tax was officially imposed. 
 However, inheritance tax was proposed several times as one of the taxes imposed after the founding of New China, but all of them were postponed. 
 As the Chinese economy has grown rapidly since the reform and opening up and the gap between the rich and the poor has widened, personal income tax can no longer meet the need to adjust the income gap. As a policy tool to control this and as a way to narrow the income gap, the question of whether or not to impose inheritance tax has been revisited. It was once the people’s choice. However, considering the current situation of China’s economic level and the gap between the rich and the poor, the introduction of the inheritance tax is considered sufficient. 
 Inheritance tax also has a positive meaning in improving the national tax system, properly adjusting the distribution of wealth among members of society, increasing financial resources for the government and social welfare programs, and maintaining national income.
 Therefore, in order for China to introduce and actually implement the inheritance tax system, it is necessary to establish a theoretically desirable basic direction. In other words, it is very important to clearly establish the
 purpose pursued by the national policy and to establish the basic direction to achieve the purpose well. 
 On the other hand, when introducing the inheritance tax system, the tax conditions such as which inheritance tax method to choose, whether to separate or integrate with the gift tax, the determination of the minimum tax amount, and the tax rate should be tailored to the actual situation in China in consideration of the inheritance tax legislative principle, efficiency and fairness. You will have to decide. In addition, research on countries that are currently successfully operating the inheritance tax system and specific plans for detailed components to suit China’s situation should be established.
 This study focused on the implementation (proposal) of the Inheritance Tax Law, which was reviewed by the Chinese Ministry of Finance in 2010, and further research by experts is also required.

보험과세제도의 개선방안에 관한 연구

Insurance contracts go beyond the main function of insurance and have the nature of similar financial products such as deposits, savings, and funds, through which they are used as a means of transfer of wealth between
 families and the uptake of property. As such, insurance products continue to diversify, but the basis for insurance-related tax revenue is not yet clear, so it is possible to violate tax law. For this, we would like to propose an improvement plan that takes into account the following problems. 
 First, there are definitions, scopes, and requirements for death insurance due to injury in commercial law. Therefore, the inheritance tax and gift tax law has no choice but to understand the concept of insurance as a borrowing concept, so it is difficult to tax based on this. In order to solve this problem, it is necessary to clarify the basis for the imposition of inheritance tax and gift tax by explicitly stipulating the nature and scope of insurance premiums, through the amendment of the Commercial Act. Second, it is necessary to clarify the scope of the interpretation of the ‘insurance contract period’ in Article 34(1)(2) of the Inheritance Tax and Assignment Tax Act. In other words, rather than interpreting on the ‘insurance contract period’ in Article 34 (1) of the same Act, it is necessary to judge the possibility of paying insurance premiums for those who have been gifted from others (the parties) according to their economic substance, rather than interpreting them based on the legal provisions or the concept of complete over the concept of complete coverage. Third, unlike the change of the insured beneficiary, the change of the insurance contractor will fall under the insurance transfer under the insurance law, and the nature of the insurance transfer will be estimated to be com-prehensive succession. Based on the estimated concept of comprehensive succession under the insurance law, it is possible to view the change time of the policyholder as the gift time to ensure legal stability, and the purpose of determining the tax base and tax amount as soon as possible can be achieved in terms of the tax law.

Clarity Principle in Taxation: An Assessment Regarding Readability Level of The Inheritance and Transfer Tax Law

Vergilendirmede açıklık ilkesi, vergi mevzuatının açık ve herkes tarafından anlaşılabilir olmasını gerektirir. Bu ilke, mükelleflerin vergiye uyum göstermesi ve verginin başarılı uygulama sonuçları vermesi açısından önemlidir. Bu çalışmada bir vergi ihdas eden ve halen yürürlükte bulunan en eski vergi kanunumuz olan 7338 sayılı Veraset ve İntikal Vergisi Kanunu’nun vergilendirmede açıklık ilkesine uygunluğu tartışılmaktadır. Bu kapsamda Kanun metni, okunabilirlik düzeyi açısından incelenmektedir. Metnin okunabilirlik düzeyi, Ateşman Okunabilirlik Formülü ile tespit edilmiştir. Yapılan hesaplamalar sonucu Kanun metninin okunabilirlik sayısı 33, okunabilirlik düzeyi zor olarak ölçülmüştür. Veraset ve İntikal Vergisi Kanunu’nun ancak lisans mezunları tarafından anlaşılabilecek, okunabilirliği zor bir metin olduğu tespit edilmiştir. Oysa bu verginin mükellefleri yalnızca lisans mezunları değildir. Bu sebeple yaklaşık 63 yıl önce yürürlüğe girmiş olan Kanun’un hem dilinin güncellenmesi hem de uzun cümlelerden arındırılarak daha açık ve anlaşılır hale getirilmesi gereklidir. Bu değişiklikler metnin okunabilirlik düzeyini arttıracak ve vergilendirmede açıklık ilkesine de uygun olacaktır.

SPC를 활용한 기업인수시의 상장차익 증여세 과세에 관한 연구

This article aims at the current legal issues on gift taxation of earnings from securities-listing. Gift taxation has been very dramatically changed in Korea. In 2005 Korea has introduced a fully comprehensive gift tax in korean Inheritance and Gift Tax Law(KIGTL). The legislative purpose was to prevent an anomalous shift of wealth without cost between citizens. But fully comprehensive taxation can violate the principle of substantial legislated
 taxation. And also it can incapacitate the principle of proportionality. Gift taxation of earnings from securities-listing in § 41-3 KIGTL is one of the controversial provisions in KIGTL. Many companies are more and more
 using in securities-listing the special purpose acquisition company(SPAC) in mergers and acquisitions. Acquisition of SPAC and the object company of the acquisition can switch the securities of related companies and forthcoming listing in 5 years can be exempted from gift taxation, because the securities of SPAC are substituted by that of acquiring company. The author thinks that this may cause a destruction of taxation justice between taxpayers in company taxation law. This article shows a new way of reasonable interpretation of § 41-3 KIGTL.

Taxation of wealth and the rich as a social imperative

The subject of the article is the problem of taxing the rich and wealth, which is among the topical topics of public interest. The study aimed to highlight the latest initiative of a group of American multimillionaires to increase the level of tax rates on this ultra-rich category of taxpayers. This initiative can be considered a solidarity tax. The task was to characterize the quantitative indicators of this initiative. The article is motivated by the striking fact that 400 American ultra-billionaires have a total wealth worth 4 thousand billion dollars! The role of the research method of the problem was carried out by analyzing the quantitative parameters and fiscal and administrative features of taxation of the rich. Results of work. First of all, the results of the study consist in the interpretation of the multicomponent concept of wealth as an object of taxation. The impossibility of a general income and property tax is revealed, such a tax exists only as an unrealized project. The fiscal and administrative reasons for the abandonment of the inheritance tax in 21 countries, including Austria, Canada, Sweden and Israel, are clarified. Conclusions. The arguments are presented that property taxes harm the processes of wealth creation and capital. For this reason, the share of property taxes in tax revenues has fallen from 42% to 14% since the beginning of the XX century. The most significant fiscal potential for strengthening the taxation of the rich are taxes on income and profits. A quantitative and institutional analysis of existing wealth taxes in Norway and Switzerland was carried out. A serious fiscal and administrative problem of wealth taxes is the valuation of taxable assets. The wealth taxes have very great, virtually inexhaustible scientific and practical potential.

PENERAPAN PAJAK WARISAN DI BEBERAPA NEGARA

Inheritance tax is still a controversial discussion. For the state, its objective is more on income redistribution than revenue collection. This research collects information on how inheritance tax is implemented in several developed countries. Japan, Korea, and the UK are countries that still impose inheritance taxes at quite high rates. As with other taxes, the calculation of inheritance tax also has aspects of reduction and exemption. Tax revenue from inheritance tax is indeed very small, on average it is still below 2% of total tax revenue. On the other hand, there is Sweden which has had an inheritance tax for centuries, but then abolished it. In addition to a small portion of revenue, inheritance tax in Sweden can hamper the economy and demotivate people in doing business.

공익사업 피수용자 세제개선 방안

So-called project operators such as the State, local governments, Land and Housing Corporation, and Urban Development Corporation implement public projects based on the Land Compensation Act, the Urban Development Act, the Housing Site Development Promotion Act, etc., tourism complexes, logistics complexes, etc. are being developed or constructed. Recently, public service projects have been delayed due to the increase in expropriation decisions, objection rulings, and administrative lawsuits filed by project operators regarding the compensation for losses from public service projects. In addition, despite the increasing number of lands of unknown ownership due to the impact of low birth rate and population aging and the decrease in land use desire due to movement from non-urban areas to urban areas, there are limitations in promoting smooth public projects by temporarily applying the Act on Special Measures for Registration of Ownership Transfer. , the economic cost is increasing. To clarify that capital gains tax, business income tax, other income tax, corporate tax, value-added tax, inheritance tax, gift tax, etc. are imposed according to the concept of transfer following the expropriation of land, etc. A special taxation system under the Restriction Act will be considered. By comparatively examining legislative cases in the United States, France, Canada, Japan, etc. on the special taxation system based on public expropriation, we present Korea's tax improvement points. In the case of land, etc., when a purchase by agreement is concluded within 6 months from the date of request for the purchase by agreement or real estate is transferred for public service use within 2 years due to alternative acquisition through land expropriation, a special limit of KRW 100 million per year is limited to KRW 300 million for 5 years A deduction system should be introduced. In addition, as the promotion of public utility projects is delayed due to the land of unknown owner and a lot of administrative expenses are required, the Act on Special Measures for the Use of Unknown Owner is enacted and special taxation system for land of unknown owner as in Japanese legislation. should be institutionalized. In addition, if the inmate files an objection or an administrative litigation when the project operator expropriates land, etc. for public works, the amount of compensation for losses is increased by adding the management principle while maintaining the principle of determination of the timing of attributing income and expenses. In such cases, it shall be the date of final judgment or final judgment of the objection, and if the amount of compensation for loss has not changed or has been reduced, it shall be regarded as the date on which the project operator deposits according to the judgment of expropriation.

공익사업 피수용자 세제개선 방안

So-called project operators such as the State, local governments, Land and Housing Corporation, and Urban Development Corporation implement public projects based on the Land Compensation Act, the Urban Development Act, the Housing Site Development Promotion Act, etc., tourism complexes, logistics complexes, etc. are being developed or constructed. Recently, public service projects have been delayed due to the increase in expropriation decisions, objection rulings, and administrative lawsuits filed by project operators regarding the compensation for losses from public service projects. In addition, despite the increasing number of lands of unknown ownership due to the impact of low birth rate and population aging and the decrease in land use desire due to movement from non-urban areas to urban areas, there are limitations in promoting smooth public projects by temporarily applying the Act on Special Measures for Registration of Ownership Transfer. , the economic cost is increasing. To clarify that capital gains tax, business income tax, other income tax, corporate tax, value-added tax, inheritance tax, gift tax, etc. are imposed according to the concept of transfer following the expropriation of land, etc. A special taxation system under the Restriction Act will be considered. By comparatively examining legislative cases in the United States, France, Canada, Japan, etc. on the special taxation system based on public expropriation, we present Korea's tax improvement points. In the case of land, etc., when a purchase by agreement is concluded within 6 months from the date of request for the purchase by agreement or real estate is transferred for public service use within 2 years due to alternative acquisition through land expropriation, a special limit of KRW 100 million per year is limited to KRW 300 million for 5 years A deduction system should be introduced. In addition, as the promotion of public utility projects is delayed due to the land of unknown owner and a lot of administrative expenses are required, the Act on Special Measures for the Use of Unknown Owner is enacted and special taxation system for land of unknown owner as in Japanese legislation. should be institutionalized. In addition, if the inmate files an objection or an administrative litigation when the project operator expropriates land, etc. for public works, the amount of compensation for losses is increased by adding the management principle while maintaining the principle of determination of the timing of attributing income and expenses. In such cases, it shall be the date of final judgment or final judgment of the objection, and if the amount of compensation for loss has not changed or has been reduced, it shall be regarded as the date on which the project operator deposits according to the judgment of expropriation.

Can Inheritance Taxation Promote Equality of Opportunities?

After a period of relatively strong economic and social mobility during the post-WWII decades, labour income is now quickly losing its capacity to fuel mobility across the wealth distribution of Western economies, with inheritance becoming again the main determinant of individuals’ ability to make it to the top of the wealth distribution. At a time where inheritance taxation therefore seems desirable from both equity and efficiency standpoints, most inheritance tax systems are broken. They have failed to be truly progressive, and have remained very unpopular among the public. In this paper, we propose general principles to guide an in-depth reform of inheritance tax systems, to make them more efficient, progressive and transparent. Using administrative survey data from France, we also discuss whether the revenue generated by these reforms can promote equality of opportunities, by guaranteeing a wealth endowment for all. Based on detailed simulations, we explain why inheritance taxation alone cannot deal with the current dynamics of concentration of wealth at the top of the distribution, and why it needs to be complemented by progressive taxation of wealth and/or capital income. <strong>JEL No:</strong> D14, D30, D31, D63, D64, H21, H24, H26, H31.

The case for (and challenges surrounding) increased de-enveloping within residential and commercial real property taxation

Abstract This article offers an appraisal of England and Wales’ real property tax regime, exploring both residential and commercial property taxation from the perspective of enveloping. It will be demonstrated that the residential property regime has been successful in closing many enveloping-based taxation loopholes, whilst the commercial property regime has taken a clear policy-based stance in permitting a limited degree of inheritance tax mitigation. That said, though both regimes are capable of drawing significant yields from direct property taxation, both struggle in obtaining revenue from enveloped holdings. Given the current socio-economic landscape in England and Wales, a de-enveloping policy is desirable. Unfortunately, uncertainty surrounding overseas entity classification—particularly as regards foundations and anstalts—thwarts this preferred de-enveloping aim. This obstacle has not been overcome by the beneficial ownership register recently introduced by the Economic Crime (Transparency and Enforcement) Act 2022. Remedial reforms are therefore proposed.

Influence of Inheritance Tax on the Size of Shadow Economy and the Volume of Tax Evasion

Abstract The objective of the paper is to investigate the influence of the inheritance tax on the amount of tax evasion in different countries. The inheritance tax is among the most unpopular taxes. It is assumed, that unpopular taxes, such as the inheritance tax, have a measurable influence on the amount of tax evasion. Countries that levy inheritance taxes and countries which don’t levy inheritance taxes are compared in their success in fighting the shadow economy over a longer period (1991 – 2017). For that, data from Medina and Schneider from 2019 about the development of the shadow economy and from the OECD about the inheritance tax revenue is used. The approach is, to find dependencies between the inheritance tax revenue and the size of the shadow economy. The results show, that countries which abolished the inheritance tax, are not anymore that successful in fighting tax evasion than they were before. There is also evidence, that countries with a relatively high inheritance tax revenue are not able to fight tax evasion to the same extent, as countries that levy relatively low inheritance taxes. Therefore, in terms of reducing tax evasion, it is not recommended to abolish already introduced inheritance taxes, but rather to continue levying a moderate inheritance tax.

Sigmund Freud, 19 Berggasse, Vienna. André Breton, 42 Rue Fontaine, Paris

Sigmund Freud, 19 Berggasse, Vienna. André Breton, 42 Rue Fontaine, Paris

Inheritance Taxation with Agents Differing in Altruism

Nous analysons une réforme fiscale qui consiste en un passage de l’impôt sur les revenus du capital vers l’impôt sur les successions, dans un monde de second rang où le gouvernement doit mettre en place des impôts distordants pour financer des dépenses publiques. Pour ce faire, nous nous plaçons dans un modèle à générations imbriquées à deux périodes de vie avec altruisme rationnel à la Barro, où la population se compose de deux types de dynasties dont les degrés d’altruisme sont différents. Avec une offre de travail inélastique, la réforme fiscale augmente le bien-être des dynasties les moins altruistes, mais diminue celui des plus altruistes. Nous étendons ensuite le modèle en introduisant une offre de travail élastique et de la production domestique, en considérant que les retraités peuvent transférer du temps à leurs enfants pour les aider dans leurs tâches domestiques. A l’état stationnaire, la réforme fiscale est Pareto-améliorante si, simultanément, les salaires nets initiaux sont faibles et la substituabilité entre la consommation de biens marchands et le temps consacré à la production domestique est élevé. Sous ces conditions suffisantes, la réforme fiscale conduit à une augmentation de l’offre de travail, ce qui permet des gains d’efficacité. Un exemple numérique illustre également que la réforme fiscale est Pareto-améliorante le long de la dynamique de transition. JEL Classifications : D64, H22, J22

Public redistributive policies in general equilibrium: An application to Greece

We develop a general equilibrium OLG model of a small open economy to quantify the aggregate and distributional implications of a wide menu of public redistributive policies in a unified context. Inequality is driven by unequal parental conditions in financial and human capital. The model is calibrated and solved using fiscal data from Greece. Our aim is to search for public policies, targeted and non-targeted, that can reduce income inequality without damaging the macroeconomy and without worsening the public finances. Pareto-improving reforms that also reduce inequality include an increase in public education spending provided to all and an increase in the inheritance tax rate on financial wealth. At the other end, we identify reforms that may reduce inequality but make everybody worse off. Regarding cases in between, a switch to a fully funded public pension system is good for everybody although it is the rich-born that benefit more by moving to a more efficient macroeconomy.