Great article Julie, in fact, I started one recenty on the same topic but was jumped upon.

Nothing unusual as this site harbors many under achievers.

.....We all have the same chances, we have to take them and work for them. If we chose to give our kids and grandkids a leg up, that should be our choice.

Sorry spindoc but I disagree, because if you are born lucky you have a chance very few poor people get.

I personally know at least three families who will leave in excess of 100$ million and which ever way you look at it, nobody deserves to be gifted that amount.

I suggested that the tax should cut in at $500,000 per sibling, with capital gains style tax to be paid on any excess.

The tax should apply to DIRECT FAMILY members only and if the donor wishes to gift outsiders, the math is simple.

Inheritance, divvied by the numbe of direct family, less the pre tax amount, then the balance is taxed prior to distribution.

Family farms, businesses are exempt unless they are either sold or borrowed against.

At the end of the day we are broke and need to find some way to fund others retirement, BUT!, every cent from this tax MUST NOT go into consolidated revenue, as it must be reserved fir funding retirees.

Hasbeen, if you take away negative gearing, you put rents through the roof.

I am astounded at the lack of realism displayed by most posters on this subject, who seem unable to face up to the facts of life.

The first point is almost all people with large assets do not want them to go to the government when they die.

The second point is that any form of taxation of inheritances will only affect the middle class. The cost of arranging your assets so that they pass tax-free to your heirs is pretty much the same no matter what assets you have; the rich can easily afford to do this, whereas the middle class will find that the cost is comparable to or greater than the tax that would have to be paid.

The third point is that there seems to be no limit to the legal lengths people will go to be able to pass on their estate. I can remember, decades ago, watching an elderly man doubled over with stomach cancer, painfully climbing the steps of a major rural newspaper to lodge an advertisement. The newspaper normally would not accept such an ad, but they accepted his. The ad stated that the man's son was a lying, thieving cheat, and that no-one should have any business dealings with him. The son sued for libel. The local jury knew what to do. They assessed damages at the value of the elderly man's considerable estate, which was transferred by court order, and the government didn't even get to collect any stamp duty.

The last point is that because of the above points, no politician desirous of re-election would ever support any such tax.

plerdsus, let me ask you a question.

Do you think an inheritance of say $500,000 per sibling before being taxed is unreasonable?

Do you also think that just because of the luck in birth, that a fourth generation person, should enjoy living in a twenty million dollar mansion, perched on a cliff face overlooking Sydney Harbour, which allows some thirty year olds the privilege of never working again and having all the toys in the world simply because dad, his dads dad and his dad worked their butts off? Or mum of cause.

Sure, live there if you wish, but not if you are going to borrow against the asset to fund an il deserved life of luxury.

This is why I say the tax should cut in at say half a million.

As for the rich avoiding the tax, this could be stopped by planning of laws.

One such law is for the government to place an easement in front of the property or a caviet when the owner passes and the only way to remove that if borrowing against the assett, or selling, would be to pay the tax.

Hasbeen, if you take away negative gearing, you put rents through the roof.
rechtub,
we haven't had anything like a tax reform & rents are already through the roof. I think with a level Tax playing field those with the go & know-how in them will prove otherwise. The only reason why everything is against Australia's economic futur is the fact that we have the system we have. My problem with negative gearing is that it fosters the Harvey Norman mentality of buy now & let others pay later. Let's face reality here, when people are given the opportunity to go head over heels into debt they will do so & the endresult is that when they default everyone else has to fork out. Does anyone actually "own" anything now ? What can one "own" without having to keep paying for continued ownership long after the goods have been bought.

Hi rehctub,

The politics of envy don’t get any prettier. I can’t believe that in Australia we have people who wish to legislate to grab the assets of fellow Australians for themselves.

How about legislating to take possession of assets belonging to those who go to a Christian school, eat pork, drive foreign cars, don’t have an ethnic background, chew tobacco, shop at Aldi, eat white bread and drink French wine?

This is not about where you are starting from, it’s about where this stops.

Fascinating, rehctub.

Your underlying premise appears to be that nobody should be allowed to get rich, whatever they do. Using death as an excuse to take away someone's wealth is merely a convenient smokescreen - fundamentally, you disapprove of any form of wealth accumulation, don't you.

>>Do you think an inheritance of say $500,000 per sibling before being taxed is unreasonable?<<

Well of course it is unreasonable.

It is most likely that the "wealth" cannot be simply divided, but instead requires the dismantling of a business, or the division of land, or the sale of property. This is pure destruction-by-envy, the roots of which are in nineteenth-century "property is theft" idealism.

How quaintly archaic.