Treasurer Jim Chalmers said there are no inheritance taxes or taxes on inherited assets in the current budget.
The clarification comes amid media reports suggesting the Labor government had backed down on a proposed "death tax" targeting discretionary trusts. Because trust structures are frequently used for wealth transfer and asset protection in Australia, any change to their tax status carries significant implications for high-net-worth individuals and estate planning.
During an interview with Sky News Australia, Chalmers addressed claims regarding a proposed 30% [1] tax on discretionary trusts. He said that the government is not implementing such a measure and emphasized that the current policy remains unchanged.
"There are absolutely no inheritance taxes or taxes on inherited assets in the budget," Chalmers said.
He further addressed the status of discretionary testamentary trusts, noting they would continue to be exempt from such taxes. However, he said that this exemption remains subject to certain integrity measures designed to prevent abuse of the system.
"That was clear already, but we're making it even clearer," Chalmers said. "We're putting that matter beyond any doubt so that all types of discretionary testamentary trusts continue to be exempt — subject to some integrity measures."
The Treasurer's remarks aim to resolve confusion following reports that the administration had softened its stance on the 30% [1] levy. By explicitly denying the existence of an inheritance tax, Chalmers is attempting to stabilize market expectations and calm concerns among taxpayers who utilize testamentary trusts for generational wealth transfer.
“"There are absolutely no inheritance taxes or taxes on inherited assets in the budget."”
This clarification serves as a strategic move to neutralize political pressure and public anxiety regarding wealth taxes. By framing the issue as a misunderstanding rather than a policy reversal, the government maintains its current fiscal trajectory while reassuring voters that the primary mechanisms for inheriting assets through trusts remain protected from new levies.
