Economist: Heirs of companies should pay higher taxes - Economist: Heirs of companies should pay higher taxes
Monika Schnitzer, chair of Germany’s Council of Economic Experts, has proposed stricter inheritance taxes for family businesses. In her annual report and interviews with Rheinische Post, she highlighted unfair differences in how assets are taxed. The call comes as the Federal Constitutional Court prepares to review current inheritance tax laws next year.
Schnitzer’s proposal focuses on closing gaps in the current system. While inheritance tax rates are not considered too low, different asset types face unequal treatment. Private households pay far higher taxes on financial assets than heirs do on business holdings.
She argues that this imbalance is unjust. Many large inheritances include not just companies but also luxury items like art, classic cars, or private jets. These additional assets often go under-taxed compared to ordinary savings or investments. The economist expects the Federal Constitutional Court to strike down existing rules in 2026. Her recommendations aim to align taxation more closely with principles of fairness, ensuring business and private wealth are treated equally under the law.
The proposed changes would affect how family businesses pass wealth to the next generation. If adopted, heirs could face higher tax burdens on both company shares and non-business assets. The court’s upcoming ruling may force lawmakers to revise the current system.
