September 1, 2026 11:25AM 

# Inheritance Taxes Hurt Investment, Growth, and Productivity 

By [Jeffrey Miron](https://www.cato.org/people/jeffrey-miron) 

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I have long [argued against](https://friedmanletter.org/#nobel) the estate tax and other inheritance tax policies. [New evidence](https://www.cato.org/research-briefs-economic-policy/impact-abolishing-gift-inheritance-tax-swedish-firms) from Sweden, which abolished its gift and inheritance tax in 2005, illustrates the harmful nature of these taxes.

The

> findings show that abolishing the tax increased the profitability, net sales, asset value, and productivity of private firms. … The reform also improved firms’ financial health by increasing current assets … and shareholders’ equity while reducing dependence on debt.

This likely occurred because > the reform encouraged economic growth by allowing firm owner-managers to invest funds in their companies rather than withdraw them in preparation for future inheritance taxes.

Additionally, the evidence

> suggest\[s\] that the reform increased the profitability of firms with potential successors, which, in turn, led to higher corporate income tax payments. Between 2003 and 2007, firms with potential successors increased their corporate income tax payments at a rate roughly 10 percentage points higher than firms without successors.

*Cross-posted from* [*Substack*](https://jeffreymiron.substack.com/p/immigration-restrictions-cause-enforcement)*.*

##### Related Tags 

[Tax and Budget Policy](https://www.cato.org/tax-budget-policy), [Libertarianism](https://www.cato.org/libertarianism) 

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