Deutsche Fassung
Stefan Moderau and Martin Ruf, 2026
Inheritance tax relief for business assets is commonly justified by the concern that taxing business succession may endanger firms and employment. Our study examines whether this argument is supported by empirical evidence.
Comparing inherited and sold family firms
Using firm-level and transaction data from Orbis and Zephyr, we compare German family firms transferred within the family with family firms sold to new owners.
Employment grows more strongly after a sale
Following the change in ownership, sold family firms exhibit stronger employment growth on average than inherited family firms.
Implications for inheritance tax policy
The findings do not support the general assumption that family succession necessarily protects employment more effectively than a sale. They therefore call into question a blanket employment-based justification for preferential inheritance tax treatment of business assets.
The results do not imply that every tax exemption is unjustified. They do, however, suggest that preferential treatment should be assessed against clearly defined objectives and supported by empirical evidence.
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