Wealth inequality has become an increasingly prominent topic in recent years. Wealth is highly concentrated at the top of the distribution, much more so than income, and income and wealth inequalities can be mutually reinforcing. Moreover, household wealth inequality has remained persistently high and has even increased over time in some OECD countries, largely as a consequence of increases in asset prices and savings rates. In some OECD countries, wealth inequality is higher than it has been for several decades.

This report provides a comparative assessment of inheritance taxation across OECD countries and explores the role that inheritance, estate, and gift taxes could play in raising revenues, addressing inequalities and improving efficiency in the future. The report provides background on the distribution and evolution of household wealth and inheritances, assesses the case for and against inheritance taxation, and examines the design of inheritance, estate, and gift taxes in OECD countries. It concludes with a number of reform options that governments could consider to improve the design and functioning of taxes on wealth transfers.

Chapter 1 examines the level and the distribution of household wealth and inheritances. It provides an overview of the level, the composition and the trends in household wealth before discussing the distribution and the trends in inheritances and gifts. The characteristics of wealth inequality and inheritances and gifts are important in the context of taxing end-of-life wealth transfers.

Chapter 2 reviews the arguments for and against inheritance taxation, drawing on theoretical and empirical literature. Through the lens of equity, efficiency, and administration, the chapter assesses the pros and cons of taxing inheritances. The chapter also discusses gift taxes, as a necessary and common complement to inheritance taxation.

Chapter 3 describes and assesses the design of inheritance, estate, and gift taxes across OECD countries. Beginning with a discussion of tax revenues, the chapter provides a comparative examination of the main design features of OECD countries’ inheritance, estate, and gift taxes.

Chapter 4 summarises the key findings and recommendations of the report. The chapter begins with a review of the key trends in inheritance taxation across OECD countries, and then presents the main recommendations and policy options that countries could consider to enhance the design and functioning of inheritance, estate, and gift taxes.