GREEN PARTY LEADER Roderic O’Gorman has indicated that income tax changes are a priority for the Greens in this year’s budget rather than inheritance tax cuts. 

Reform of the inheritance tax system is on the table in this year’s budget, with Taoiseach Simon Harris telling The Journal that reforms to the tax “deserve to be considered” in the run up to October’s budget. 

The Taoiseach added that there were “unfairnesses” and “anomalies” that need to be addressed. 

Under the current rules, children are able to inherit €335,000 from their parents before they have to pay tax at 33%.

Increasing the tax threshold before children have to pay inheritance tax to €400,000 will cost €52 million to the Exchequer.

Progressive budget 

When asked if inheritance tax cuts would be a priority for the Green Party in this year’s budget, O’Gorman said the priority of his party “is to ensure this is a progressive budget and to make sure that we continue our investment in public services”.

He outlined that in the programme for government there is commitment to changing the indexation of the tax bands, so as to ensure low pay workers “aren’t thrown into the tax net” and those on the standard rate of tax aren’t brought into the higher tax band as their wages rise. 

“That’s our priority on the taxation side of this budget,” he said.

O’Gorman said that of the €1.4 billion set aside for taxation measures, most will be used to tackle income tax changes. 

“Obviously, any other taxation measures can be examined in the round in terms of what’s left, but the core priority for government in each budget is to make sure work pays, and that nobody is penalised by the taxation system because their own wages have risen,” said O’Gorman.

When put to him that his response didn’t indicate that inheritance tax reforms were high on his agenda, the Green Party leader said: 

“I think what’s high in taxation terms is making sure that work pays for people.”

The Department of Finance’s Tax Strategy Group recommended last week that changes to the inheritance tax framework “may now be appropriate”, stating that legislation could also be introduced to make it mandatory to file a tax return on all inheritances and gifts, no matter how small.