Wealth Transfers and Net Wealth at Death: Evidence from the Italian Inheritance Tax Records 1995-2016
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Chapter in forthcoming NBER book Measuring and Understanding the Distribution and Intra/Inter-Generational Mobility of Income and Wealth, Raj Chetty, John N. Friedman, Janet C. Gornick, Barry Johnson, and Arthur Kennickell, editors
In this paper we describe a novel source of data on the full record of inheritance tax files in Italy, covering up to 63% of total deceased. The work documents a substantial rise in the share of inheritance and gifts as a share of total national income, from 8.4% in 1995 to 15.1% in 2016. Consistently with the substantial and increasing role of total personal net wealth in the economy, the weight of inheritance and gifts in Italy appears relatively high by international standards. Over the same period, total wealth left at death has also become increasingly concentrated.The millionaire estates were worth 14% of total estate in the mid-1990s and almost 25% in 2016. This paper also documents that revenues collected from the inheritance tax experienced a threefold decline from 0.15% to 0.05% of total tax revenue between 1995 and 2016. Data also allow a disaggregated analyis by demographic and geographic characteristics.