No Inheritance Tax Argument:
Inheritance tax IS double taxation and should be ended, as it is an unfair financial penalty as well as economically inefficient.
Explanation:
The inheritance tax (estate tax) constitutes a form of double taxation as it is levied on assets passed down to heirs after an individual’s death. However, these assets have already been taxed at multiple points throughout their lifetime. Income taxes, capital gains taxes, property taxes, and corporate taxes (all existing tax obligations that individuals meet during their lives). So by the time assets are passed down, they have already been significantly diminished by the tax system.
Inheritance taxes undermines the basic tax principle that assets should not be taxed repeatedly in the hands of the same economic unit—in this case, the family/heirs.
This concept of “double taxation” argues that families and heirs should not be financially penalized simply for inheriting what their parents or relatives have already paid taxes on.
Also, the inheritance tax makes it harder, in some cases impossible, to create generational wealth. Specially in the case of middle class or those rising into the middle class because it means that the hard work of the previous generation, as well as the capability of growing generational wealth within the family/succession line will be significantly diminished in the best cases or completely truncated in others. This is because many heirs are forced to sell portions—or all—of the inherited assets, disrupting the continuity of family businesses and/or destroying generational wealth that took decades to build.
Because of this effect, the inheritance tax is a barrier to financial stability for many families.
Allowing untaxed inheritance assets to be fully reinvested—whether through spending, investing, or expanding a family business—can have a far greater positive impact on the economy than if the government taxes these funds and allocates them to expenses or programs. Direct reinvestment fuels immediate economic growth, creates jobs, and supports local businesses, offering a more tangible and faster and higher-impact economic boost than government redistribution.
No Gift Tax Argument
Gift tax IS double taxation and should be ended in some cases or significantly reduced in others, as it is an unfair financial penalty as well as economically inefficient.
Explanation
When you gift money to another the one making the gift has already paid taxes on it and the receiver will receive less either because the taxes make the gift too fiscally burdensome or because it will be taxed and less is received.
I argue that gifts/donations should not be taxed at all when made within the family either amongst spouses, vertically within the family tree (grandparents-parents-children), or horizontally within the family tree up to 2nd degree of separation (siblings and first cousins).
Additionally no gift tax should be applied to charitable donations for healthcare, education, and basic needs (home, food, and clothing) within the family tree with no limitation on degree of separation, no limitations on amount gifted, and no limitations of age of receiver of the donation.
No gift tax when gift is for a third party as long as the payment is made directly to the healthcare, education, and basic needs (home, food, and clothing) service, institution, or company that renders the service or good; amount limits on home, food and clothing could be established for third party individuals (no amount limit on health and education donations to third parties).
Summary
By allowing families to keep the full amount of their inheritance and/or gift, wealth remains in the private sector, where it is more likely to fuel dynamic economic growth through reinvestment. Along with this, private individuals tend to reinvest or spend inheritance/gift funds more immediately, providing faster, more targeted economic stimulus. This approach ultimately leads to a more robust economy, characterized by increased business creation, job growth, and consumer spending—all critical elements of a thriving economic environment.
