Planned new death duties are aimed at boosting donations to charities and the redistribution of wealth. The proposed inheritance tax was briefly mentioned during the Government Work Report at the National People's Congress, which ended last week. The Beijing Youth Daily said yesterday China had several million households with assets worth more than one million yuan (HK$935,000) and many people owned property worth between 10 million and 100 million yuan. The paper said the tax would only be levied on a few rich people and although the threshhold would not be set too low, it would be a progressive, five-grade system. The taxman would take into account debts, funeral expenses, the burden of supporting dependants and other obligations when assessing the tax. To encourage people to make donations to charitable foundations useful to society, donations would be tax-free. Although the inheritance tax was also intended to boost government tax revenues, the report said another objective was the redistribution of social wealth. 'To some extent it will curb the trend of polarisation of wealth, and will encourage people to get rich through labour. If many people live off a huge inheritance, this will create many social parasites,' the paper said.