Inheritance and estate-tax restoration

Statement

Restoring the inheritance-tax framework that existed pre-1981 — substantially lower exemption thresholds, the elimination of step-up-in-basis at death, closing the dynasty-trust route — addresses the intergenerational component of wealth concentration directly. Historically, the US compression of top-wealth shares between 1930 and 1980 tracked the rise of estate taxation; its erosion since 1981 tracked the renewed rise.

Provenance

Sources

• Saez & Zucman — Wealth Inequality in the United States since 1913
  paper · 2016 · Saez, Zucman
  https://gabriel-zucman.eu/files/SaezZucman2016QJE.pdf
  Historical analysis showing that the rise of estate taxation in the 1916-1980 period coincided with the largest compression of US top wealth shares since records began; recent erosion of the estate tax tracks the subsequent re-concentration.
• Brookings — Taxing wealth transfers through an expanded estate tax
  report
  https://www.brookings.edu/articles/taxing-wealth-transfers-through-an-expanded-estate-tax/
  Costs two expanded estate-tax designs, one at a $1m exemption with a flat 40% rate and one with a low exemption and rates rising to 75% above $20m, as instruments for reducing wealth concentration.

Causal links