Ségal Le Guern Herry, Aix-Marseille School of Economics

Wealth and inheritance taxes often fail to effectively target top wealth holders when business assets are excluded from the tax base. Yet in practice, most such taxes either fully exempt business assets or apply highly preferential treatment. A key justification for this design is the concern that taxing business assets may create liquidity constraints—particularly for heirs or owners of valuable but illiquid businesses. This project examines the prevalence of such liquidity concerns. I focus on Norway, where an inheritance tax applied to the full wealth of decedents—including business assets—until its repeal in 2014. Leveraging this salient policy change, the study investigates whether and to what extent heirs faced liquidity pressures when inheriting business assets subject to taxation.