Estate tax calls for more transparency

Experts in China have been debating the merits and drawbacks of imposing an inheritance tax for years, with camps on either side of the issue wrangling over the legal and economic implications of such a levy.

In many developed nations, inheritance taxes - also known as estate taxes - play an important role in reducing socioeconomic gaps by restraining intergenerational transmission of wealth. Evidence also suggests that such taxes have made the rich more inclined to leave portions of their wealth to charities and philanthropic organizations.

China could greatly benefit from an inheritance tax, in light of its own looming problems with inequality. China's Gini coefficient - a measure of wealth disparity - stood at 0.474 in 2012, higher than BRIC peers India and Russia.

Such a tax can only have an affect though once all relevant details have been hammered out. Firstly, comprehensive records are needed to monitor personal wealth and property. In China today, no such system exists. Rich individuals can easily hide their money in vehicles and assets that are difficult to trace.