Optimum taxation of bequests in a model with initial wealth

Arbeitspapier

We formulate an optimum-taxation model, where parents leave bequests to their descendants for altruistic reasons. In contrast to the standard model, individuals differ not only in earning abilities, but also in initial (inherited) wealth. In this model a redistributive motive for an inheritance tax - which is equivalent to a uniform tax on all expenditures - arises, given that initial wealth increases with earning abilities. Its introduction increases intertemporal social welfare or has an ambiguous effect, depending on whether the bequeathing generation can adjust their behaviour and whether the external effect related to altruism is accounted for in the social objective.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 1001

Classification and Topics

• Classification: Wirtschaft ; Taxation and Subsidies: Efficiency; Optimal Taxation ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
• Subject: Optimum taxation ; taxation of bequests ; Erbschaftsteuer ; Optimale Besteuerung ; Erbe ; Altruismus ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Brunner, Johann K. ; Pech, Susanne
• Event: Veröffentlichung
• (who): Johannes Kepler University of Linz, Department of Economics
• (where): Linz
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/73625
• Last update: 10.03.2025, 11:43 AM CET