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Estate Duty Removal (brief random thoughts) |
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Written by Wilfred Ling
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Tuesday, 19 February 2008 |
I was asked by a few people what will be the impact of the removal of estate duty. I haven't put much thought to it. Currently the only thing in my mind is:
- It is no longer needed for a person to park the bulk of their money in property. Previously the first $9m in property is exempted from the death. With the abolishment of the death tax it means that people can park their money on any kind of asset including stocks, unit trusts, ETFs, cash, precious metals, pearls, cameras, art, wine, hedge funds, structured notes, collectable toys ... practically in anything without fear of the death tax.
- Property market may face a downward pressure due to people wanting to rebalance their portfolio by parking into non-property assets. But then I doubt the property market will face downward pressure due to this reason. This is because it is unlikely there are many people who had done financial planning and thus had previously planned to reduce their death tax by having bulk of their asset in property.
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