Daniel Stelter is the founder of the discussion forum beyond the obvious, which specializes in strategy and macroeconomics, and is a management consultant and author. Every Sunday his podcast goes online at www.think-bto.com.
(Photo: Robert Recker / Berlin)
“The truth about inheriting” recently promised a ZDF documentary. But instead of enlightenment, the program offered prejudices and served clichés: on the one hand, the young family with no chance of their own apartment, on the other hand, the arrogant, socially disinterested inheritance, only oriented towards personal benefit.
Desired conclusion: inheriting is unjust and solidifies the already high inequality in the country. Grist to the mill of politicians who want to tax inheritance high.
Apart from the fact that inheritances, according to calculations by the Institut der Deutschen Wirtschaft (IW), help to reduce inequality, it is worthwhile to look at the subject.
Adam Smith (1723-1790), founder of classical economics, already recognized: “Economies in which frugality and capital accumulation dominate, flourish in the long term. Economies in which current income, spending and borrowing dominate are perishing. “
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We can count ourselves lucky that, after the devastation of two world wars, we have again a generation that will inherit on a large scale. We have built up capital, nothing else is wealth. Given the finiteness of life, it is normal to pass it on to the next generation.
Most of the assets to be inherited are tied up in companies. In the case of very large inheritances in particular, company investments play an important role. Exactly these are spared by the legislature with a view to securing substance and maintaining jobs with inheritance tax. And for the heirs it is by no means “lacking in performance”, as critics claim, but rather connected with the obligation to preserve and develop the inheritance.
Tax for “little millionaires”
What remains is a tax for “little millionaires” who do not have the opportunity to escape the burden with tax structures. Increasing the inheritance tax burden here is neither fair nor expedient. What should the goal be? To distribute the wealth in Germany more evenly. But we do not achieve this by redistributing existing wealth, but by helping the broad masses to build wealth.
This starts with a lower tax burden, better investment opportunities and goes all the way to a state inheritance – for example 20,000 euros – for everyone who has completed vocational training. Gladly financed by a low inheritance tax without exceptions.
That is the path the new government should be taking. But if those who are skeptical about private wealth prevail, we reward consumption and punish frugality. The opposite of what we need to secure our future prosperity.
More: Inheriting without a will – what is the legal succession?