According to a Swiss bank that is preferred by the extremely wealthy, newly minted billionaires have accumulated more wealth through the deaths of relatives than through their own work and business ventures.
According to a UBS report, around 53 individuals who became billionaires in the 12 months leading up to April of 2023 received a total inheritance of USD 150.8 billion (119 billion pounds) from their families. This sum surpasses the USD 140.7 billion generated by “84 new self-made” billionaires during the same time frame.
According to the bank, “The next generation of billionaires accumulated more wealth through inheritance than entrepreneurship for the first time in the nine years of its annual report on the fortunes of the richest 0.00004% of society.”
“This is a theme we expect to see more of over the next 20 years, as more than 1,000 billionaires pass an estimated USD 5.2tn to their children,” Benjamin Cavalli, the head of strategic clients at UBS Global Wealth Management said, as reported by The Guardian.
According to the report, ‘these families’ growing significance can be seen across all major geographical regions.’ The average wealth of inheritors in Asia-Pacific was USD 2 billion, while that of entrepreneurs was USD 1.06 billion.
The inheritors’ net worth in the Americas was USD 2.2 billion, compared to the entrepreneurs’ USD 1.5 billion. Two times as wealthy as the entrepreneurs (USD 2,022 billion) are the inheritors in Europe, the Middle East, and Africa (EMEA).
It happens at a time when public discussion regarding inheritance tax’s contribution to funding public services and aiding low-income families facing the crisis of rising living expenses is intensifying.
The British chancellor, Jeremy Hunt, was under pressure to lower inheritance tax in his autumn statement from certain members of his party. On estates exceeding 325,000 pounds, he maintained the 40% tax rate.
It has been observed that just 4% of the wealthiest families in the United Kingdom are impacted by the tax.