Australia debates formal inheritance tax, citing wealth inequality and existing tax burdens on super and capital gains.

Australia is debating a formal inheritance tax amid concerns over wealth inequality and fiscal strain, though it already imposes a de facto tax through superannuation and capital gains rules. Non-dependent beneficiaries face a 17% tax on super death benefits, potentially costing tens of thousands on large balances, and must pay capital gains tax when selling inherited assets based on original cost. Many families miss tax-free withdrawal deadlines due to planning delays. While estate planning can reduce tax burdens, critics warn a formal inheritance tax could lead to gift taxes. Meanwhile, superannuation rules allow continued non-concessional contributions if balances stay under $2 million by year-end, and compounding remains vital when earnings are reinvested.