The Community Council for Australia has asked the federal government to re-introduce the ‘death tax’ on the ‘super rich’ Australians, thereby raising federal revenue to $5 billion.
One percent of the people who reach Australia’s richest list would have to pay the inheritance levy once introduced again, affecting the lives of about 100,000 wealthy people across the nation. The request has emerged as a result of the tax system changes being considered by the federal government relating to goods and services tax (GST), superannuation tax concessions, etc.
There are several countries including the United Kingdom and the United States that advocated and implemented the death tax on the affluent category of people. The tax takes some money back from the wealthier people who are willing to transfer their assets to their younger generation after they pass away.
The Organisation for Economic Cooperation and Development (OECD), a 30-member organisation, has also recommended the death tax reform for Australia. However, it also identified a major problem of people transferring their properties by drafting their will prior to their death.
Community Council for Australia’s boss Tim Costello said that he was well aware of the transfer of property before death, but he still thought to give it a try. He said that in the UK, if people transferred a part of their property to charity, their death tax is discounted. “Charitable giving in Australia from the rich is low compared to Britain and America,” Costella told the Sydney Morning Herald. “If [people] donated part of their inheritance to charity that portion could be tax-free.”
The lobby group’s Chief Executive David Crossbie said that most of the OECD member countries feature inheritance tax, which seems to be a really good option. There are several charities that fall under the lobby group, which include The Smith Family, World Vision and Beyond Blue.
“It would only apply to one percent of the population, and that would be people who have over $5 million in net wealth,” Crossbie said as quoted by the ABC. “So it won’t impact on 99 percent of people.”