Don't worry, the kids are cool if you cash in on their inheritance

Credit: CC0 Public DomainSpend big on retirement plans and cash in on your children's inheritance. This is the message from the University of South Australia. New research has shown that older adults are more interested in spending their savings than passing it on to their children.It may sound like bad news for younger generations, but the research confirms that children are perfectly content with the situation, and claim that no one owes them anything.These surprising results are part of a new study on attitudes to wealth transfer taxation in Australia. It examines current attitudes and finds that resistance to inheritance or estate taxes may have decreased in Australia over the past 40 years.The only major income source that isn't taxed in Australia is inheritance. A person who earns their income works for it, while someone who gets a bequest isn't liable for capital gains taxes.Social policy expert Dr. Veronica Coram of UniSA's Australian Alliance for Social Enterprise believes that the decline in bequest motive offers a significant opportunity for Australian taxes reform and a valuable opportunity to address social inequalities."Death and taxes are the only sure things. However, while most people assume that the combination is unpopular, Dr. Coram claims that our research supports this."We spoke to senior Australians as well as young adults. Two thirds said Australia should consider reintroducing estate taxes. Only one in ten was against."The lack of interest to give or receive inheritances meant that most participants saw little reason to object to estates becoming taxed. This opens up potential opportunities for tax reform."Inheritances are generally given to those who are already wealthy and don't require them. They encourage inequality and hinder social mobility."The Australian government must find ways to increase revenue to meet increased spending requirements generated by COVID-19. This is due to an ageing population, pressures on health systems, and growing environmental disasters."Reintroducing inheritance taxation or estate taxation is one way to increase government revenue while also reducing inequality."Although politicians and policymakers might be cautious about making decisions, Dr. Coram believes that the findings reflect changes in social norms in Australia as well as other OECD countries."Historically inheritance taxes were considered to be a form of political suicide. Ironically, they may be coming of age due to increasing individualism and decline in the belief that family members should care for each other," Dr. Coram said."More research is needed on shifting views towards redistributive policies, but our study suggests that governments should not assume that Australians oppose wealth transfer taxation if they are considering tax reform."Continue reading: Study finds that adult children who receive parental cash aren’t happier and healthierMore information: Veronica Coram. A qualitative investigation of attitudes towards wealth taxation in Australia. Australian Journal of Political Science (2021). Veronica Coram. A qualitative exploration of attitudes toward wealth transfer taxation (2021). DOI: 10.1080/10361146.2021.1935451