Some inherit millions, others nothing at all. Is that fair? No, says Yannick Haan. The author and politician himself inherited it. In an interview with ntv.de, Haan explains how that fits together, why inheritance is not just about money and how everyone would benefit from a basic inheritance.
ntv.de: Mr. Haan, you inherited it yourself. How many people in Germany can hope for an inheritance?
Yannick Haan: Unfortunately, there are no exact figures. But it is estimated that around a third of Germans inherit a substantial sum, a sum that really makes a difference. The rest inherit nothing or only so little that it is negligible.
Has inheritance made a difference for you?
Yes. I was able to buy two apartments, which gave me great security, especially during the crisis. But I also have to say that even before the inheritance I didn't have to worry about my financial situation. I grew up privileged, I'm well aware of that. But inheritance gave me the freedom to devote myself to projects I might not have tackled before - like my book, for example.
Now the title of your book is "Disinherit us at last!". How does that fit together?
Through my inheritance I started to deal with the topic. Inheritance sums in Germany are getting bigger and bigger. Almost 400 billion euros are inherited or given away every year. The Treasury only benefits from this with around 11 billion euros. Because the inheritance tax is currently just over two percent on average. With a view to the income tax, for example, that seems ridiculously little. I don't understand why people are willing to pay high taxes on work but not on assets they didn't inherit. Nowhere else in Europe is the difference between taxation of work and wealth as great as here in Germany. But there is a lack of awareness of this. In the debate, reflexively, grandma's house is called upon, which is supposed to be taken away from her.
But isn't that true?
When it comes to wealth inequality, it's not about grandma's house, it's about the large inheritances. Today we have a tax system that becomes regressive from ten million euros. This means that whoever inherits more pays less tax. In the case of the largest inheritances in particular, zero percent tax is usually paid. An example: If you inherit three apartments, you pay inheritance tax, but if you inherit 300 apartments, it is considered a business asset and you pay nothing. This is anything but fair.
How can the system be made fairer?
Tax increases are always a difficult subject. Nevertheless, it would be important to tax the high sums of inheritance. Then you could introduce a so-called basic inheritance.
The idea is simple: at the age of 18, everyone inherits 20,000 euros from the state. The state inheritance can be spent on studies, training, investments or the like. The money is available to everyone, regardless of the parents' financial situation. The richest in society, who have accumulated wealth in the past, should give back a portion to provide opportunities for the next generation. In this way, everyone could benefit from the principle of inheritance, regardless of origin, education or social status.
What does the average German heir look like?
The prototype of the average heir in Germany is actually significant: he is male, white, mostly self-employed, older and has no migration background. Is this what a society we want to live in looks like? With heirs we cement a society of the past. Because people with money have political influence, a lobby. You can invest and increase your wealth. A basic inheritance would give everyone this chance.
The counter-argument is often that such redistribution principles - such as the unconditional basic income - only cost the state and encourage laziness. Wouldn't it be better to create opportunities for everyone to be able to do it on their own?
If you look at the numbers and statistics, we have a concrete society. The top and bottom 10 percent are drifting further and further apart. Financial advancement is very difficult if not impossible. This is also shown by an OECD study on social mobility. In the Europe-wide ranking, Germany is in last place with Hungary. Very few actually make it out of poverty on their own, but for the vast majority financial prosperity remains unattainable. The inequality of wealth and opportunity will damage our democracy in the long run if a lot of money and power is distributed among just a few people.
The inherited wealth arose from the income earned by the parents, which has already been taxed. Why should the state go strong again?
We have a tax system that taxes multiple times. Whenever there is a transaction, there are also new taxes on it. I pay income tax and then also VAT when I take it to the supermarket. It shouldn't be any different when it comes to wealth.
Most of the money is now in family businesses. You want to protect these companies separately and ensure continued operation even after an inheritance, after all there are many jobs at stake. Are these companies at risk of higher inheritance tax?
There are studies that clearly state that an inheritance tax does not pose any great dangers to family businesses either. After all, it is only due once with each generation change. You also have to look at what is inherited. Most of the time, it is stocks whose taxation does not harm the company. There is also the option of spreading the taxes, i.e. paying them over several years. And you can define exceptions if jobs are really at risk. So far, however, little has been done at the political level.
But at least something is happening: from next year, real estate will be valued significantly higher when given away and inherited. Many people fear that they will then have to sell their parents' house in order to be able to pay inheritance tax. How can you catch these?
To be honest, I don't understand the worries, because if you stay in the house you inherited, you won't pay any taxes in 2023 either. So if you use the property yourself, you are completely exempt from inheritance tax. This only comes into play if you rent the house or apartment and also generate income from it. And the crises of the last few years have shown very clearly that anyone who owns real estate is one of the winners in society.
Do you have a guilty conscience about having inherited?
I don't have a guilty conscience. The state says yes, I am entitled to the inheritance. Blame and shame are the wrong way. But you also have a responsibility to deal with it well. If you grow up privileged anyway and then get an additional cash injection, you should at least make it transparent and talk about it. You should consider how you can change something for society as a whole and get into the debate, especially for people who just don't have a voice.
Mit Yannick Haan spoke to Hedvig Nyarsik