Australia\u2019s intergenerational wealth gap is widening, fuelled by record-high inheritance transfers and a tax system that favours accumulated wealth over earned income. <\/p>\n\n\n\n
With younger Australians struggling under rising living costs and housing unaffordability, some economists argue that an inheritance tax<\/strong> could help restore financial fairness.<\/p>\n\n\n\n This article appeared on The Sydney Morning Herald<\/a> and discusses the growing role of parental wealth in determining financial security, prompting debate over whether Australia should reintroduce an inheritance tax. <\/p>\n\n\n\n The proposal comes as the largest intergenerational wealth transfer in history unfolds, with Baby Boomers set to pass down $224 billion annually by 2050<\/strong>.<\/p>\n\n\n\n Australia is witnessing an unprecedented intergenerational asset transfer, with inheritances <\/a>playing a crucial role in home ownership and financial security. <\/p>\n\n\n\n Research from the Centre for Equitable Housing shows that parental support for first-home buyers has surged from 15% in the 1980s to over 40% today.<\/p>\n\n\n\n The once-optional financial help from family has become a necessity for many young Australians entering the property market. <\/p>\n\n\n\n Meanwhile, national prosperity has grown far faster than wages, deepening the divide between those with access to generational wealth and those without.<\/p>\n\n\n\n Unlike earned income, inherited wealth remains untaxed<\/strong>, reinforcing economic advantages for those born into wealthier families.<\/p>\n\n\n\n Australia is one of the few OECD <\/a>countries without an inheritance tax, having abolished it in the late 1970s. In contrast, many other developed nations impose estate taxes to balance economic disparities. The absence of such a policy means that younger workers are often taxed more heavily than investors and wealthy retirees.<\/p>\n\n\n\n Critics argue that this system prioritises accumulated wealth over hard work, exacerbating financial inequality between generations. Thomas Walker<\/a>, CEO of Think Forward, believes this structure is unsustainable, as financial success is becoming increasingly tied to birthright <\/strong>rather than personal effort.<\/p>\n\n\n\n Public sentiment on inheritance taxation appears to be shifting. A survey conducted by Think Forward found that 73% of younger Australians support taxing estates valued over $1 million. <\/p>\n\n\n\nA Shifting Economy Shaped by Inheritance<\/h2>\n\n\n\n
A Tax System Favouring Wealth Over Wages<\/h2>\n\n\n\n
Growing Support for Inheritance Taxation<\/h2>\n\n\n\n