In a report presented on Wednesday, the Committee of Economists notably proposed reforming the inheritance tax, which would focus on heirs rather than donors, in order to reduce the inequality of opportunity, which is stark in France.
The Nobel Prize in Economics Jean Tirol and former IMF chief economist Olivier Blanchard on Wednesday, June 23, presented their stylized “toolbox” report on pensions, employment or the climate, unless it’s one year from Emmanuel Macron’s presidential election. (Paul/Michael Euler)
The Commission of Economists tasked by Emmanuel Macron to reflect on the challenges of the post-Covid economy presented on Wednesday, June 23 his suggestions , designed as a “toolbox” on pensions, employment or the climate, less than a year after the presidential election. This panel of 26 French and foreign economists, led by Nobel Laureate Jean Tirole and former IMF chief economist Olivier Blanchard, is proposing a comprehensive reform of the inheritance tax.
The French today accept inheritance tax very poorly because they want to be able to pass their inheritance on to their children without taxation, while deeming that “unequal opportunities at birth due to different endowments constitute an injustice,” their report recalls. Hence the “equality of opportunity logic”. It involves caring, not in those who give, but in those who take , by retaining as a tax base the total amount received by the beneficiary”, with a high level of reduction.
the proposed solution: “We take all donations and inheritances from all sources a person receives and we have a progressive tax on that” , explains Harvard economist Stéfanie Stantcheva.
“This would help make this tax more common by reducing the perception that it is a double tax on the savings of parents who have ‘worked hard’ and who wish to help their children,” explains the Tyrol Blanchard Committee.
Today, the inheritance tax primarily affects the donor, who can make tax-deductible donations every 15 years, benefiting the best and wealthiest. In addition, The system includes numerous exceptions, notably in life insurance and family business transfers, which the report recommends reviewing.
The report notes that income from inheritance taxes can fund increased investments in early childhood and education.
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