About the Abolition of All Right of Inheritance

The third plank of “The Communist Manifesto” by Karl Marx suggests that to create a truly just society, abolishing the passing down of family wealth to succeeding generations is necessary. Opponents of the American estate tax often cite this stance on inheritance to denigrate the tax, which they view as confiscatory double-taxation.

In Marx's view, “the abolishment of all right of inheritance," as he put it in his 1848 tome, was essential to a collectivist society. In an 1869 pamphlet titled the “Report of the Fourth Annual Congress of the International Working Men's Association,” Karl Marx wrote that the abolishment of inheritance would be part of a natural progression, once private ownership of land and “means of production” discontinued. With the means of production transferred to the state, there would no longer be any personal, privately held wealth to pass down. Marx cautioned, however, that abolishing inheritance without a radical change in the socio-economic order would be a reactionary distraction.

Forty years before publication of Marx’ pamphlet, followers of French aristocrat Claude Henri de Saint-Simon, known as Saint-Simonians, built upon Saint-Simon’s promotion of social interdependence and anti-individual selfishness by attacking inheritance. Inheritance, they believed, was a counterproductive practice in which children of the rich were given wealth unearned by merit or contribution to society. Although Saint-Simon believed that ownership of private property was proper and necessary to create productivity, he did not believe property was imbued with natural dynastic rights.

According to the Internal Revenue Service, or IRS, the federal government taxes inheritors on amounts exceeding $5,490,000 in 2017. The Estate Tax, which the IRS says only affects the wealthiest two percent of Americans, taxes the market value of all inherited property, such as securities, real estate, insurance and annuities over the value of the exclusion. This “estate gross” may reduce further by deductions, such as mortgages and “estate administration” costs. Most inheritances do not require the filing of an estate tax return.

Despite widespread suspicion that it would repeal the federal estate tax in its entirety by the year 2025, the recent Tax Cut and Jobs Act kept the current estate tax system in place. The government has, however, doubled the estate tax exemption to $11.2 million for the tax year 2018. Under this regime, less than one percent of the population will pay estate tax. Nonetheless, the tax is projected to still put significant revenues into government coffers each year. Some commentators suggest that this resolution is fairer than abolishing the tax, which would widen the already unprecedented wealth gap and increase deficit spending.