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REFORM OF INHERITANCE tax is on the table in this year’s Budget, but Tánaiste Micheál Martin has ruled out abolishing it entirely on family homes similar to countries like Canada and Australia.
Speaking to reporters in Addis Ababa this afternoon the Tánaiste and leader of Fianna Fáil said it is his view that inheritance tax as it stands is “punitive” on the average family.
His comments come after Taoiseach Simon Harris said earlier this week that reforms to the tax “deserve to be considered” in the run up to October’s budget.
Under the current rules, children are able to inherit €335,000 from their parents before they have to pay tax at 33%.
However, those in Fine Gael, such as Minister of State for financial services Neale Richmond, have argued for reforms and have highlighted that 13 years ago, a person could inherit €542,544 or be gifted that amount before paying tax at 22%.
When asked if government would consider abolishing inheritance tax on the family homes, Martin said today:
“No it won’t be abolished, the Minister of Finance may look at aspects of it. But we’ve got to be realistic.”
The Minister for Finance Jack Chambers will announce the details of the entire tax package in the Budget “but the bottom line is we have €1.4 billion put aside for tax measures”, said the Tánaiste.
He said the overwhelming bulk of that will go towards reduction in personal taxation, income tax, and “maybe USC, that’s to be determined”.
“Other areas will be looked at including inheritance tax but it won’t be abolished,” said the Tánaiste, who added that the focus needs to be kept on the fact there is a €1.4 billion pot.
“How much it takes to keep pace with wage growth. That’s the key priority. And there’s not a whole lot left is what I’m saying after you do that to do other things.
“But it is on the table in terms of potential reforms. And I actually empathise with those who feel it’s too punitive on the average family home. I do accept that principle.
“But in one Budget, the minister may have some proposals to bring to us in respect of that but his room for maneuver is limited,” he said.
Martin refused to be drawn on the details or whether there would be an increase to the threshold.
The Taoiseach said earlier this week that there are issues around “unfairnesses” and “anomalies” within the inheritance tax system.
In response, Sinn Féin’s Pearse Doherty told The Journal yesterday that he wasn’t surprised Harris is looking to “favour those who are coming into large wealth” by floating the idea of inheritance tax changes in this year’s budget.
Sinn Féin, in its last alternative budget, proposed to increase the rate of inheritance tax by 3%, from 33% to 36%.
Doherty confirmed that increasing the inheritance tax rate is still the party’s policy.
With reporting by Christina Finn
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Spain also has pretty much 0% inheritance tax too and they have a perfectly functioning healthcare system amongst lots of other things that function in their country but we can’t seem (or don’t want to!) fix…
@Lydia Mcloughlin: CAT only accounted for 0.5% of govts haul last year, €641million…… They have definitely wasted way more than that
@Lydia Mcloughlin: Vote for the Fair Dems party. They will abolish Inheritance Tax and Local property tax, like Sweden and other decent, fair societies.
https://x.com/FairDemParty
It will be replaced by a Financial Transaction Tax on trading stocks and bonds and a tax on Jet fuel which is Zeroooooo!
It’s all just getting too much. I don’t think revenue understand that. The endless stream of taxes. I wish they would just stop, take a beat, and realise we are crippled with taxes. It’s just gone too far.
It’s just so depressing and the new taxes just keep coming. JUST STOP !!!!!
@R. Gantly: New taxes???? Where?
@Sean O’Dhubhghaill: I’m sure they’ll raise PRSI again while reducing the USC…… Give with one hand, take with the other!
@Sean O’Dhubhghaill: ERR for employers, auto enrolment pensions, prsi going up (slightly but up). Look them up.
@did you every wonder: so one of those taxes (the tiny one) affects individuals, the others are levied on employers, are progressive, and necessary
@did you every wonder: You can opt out of the auto ernrollment. Prsi isnt new.
@Sean O’Dhubhghaill: media tax, increases in property tax, road tax, VRT the last is endless…..
@Sean O’Dhubhghaill: you can only opt out of auto enrollment for 2 years, after that you have no choice, oh and you can’t opt out in the first 6 months, also the government will decide what the individual will pay into it, and it taken at source, and it goes up every year for the first 10 years, so if you earn 20€ thousand a year you are in it, that’s a large chunk out of small wages, it’s also calculated on gross wages too. First Red Flag – its not garunteed, but will be regulated, Oh and the biggest red flag, Revenue are not doing it, an outside company has been hired!!!!!!
@R. Gantly: Your taxes are needed to fund the mass migration madness.
The amount of tax already paid on the house by the time a son/daughter inherits it should surely come into it. When you buy a house you pay tax on it, the sellers pay a tax on it and the buyers pay a tax on it within the transanction, included in your repayments is a tax, if the owners rent out the property they have to pay a tax on that, you now pay a property tax for being lucky enough to own a property. And an inheritance tax thrown on at the end for good measure. All this is free money for the government which the householder get absolutely nothing for. Makes no sense.
@Bryan: Vote for the Fair Dems party. They will abolish Inheritance Tax and Local property tax, like Sweden and other decent, fair societies.
https://x.com/FairDemParty
It will be replaced by a Financial Transaction Tax on trading sticks and bonds and a tax on Jet fuel which is Zeroooooo!
Inheritance tax is a disgraceful tax that should have been abolished long ago. It ranks up there with the illegal VRT tax but greed is very,very good for our government.
@Gerry Lamont: The sheeple still voted for the status quo on June the 7th.
.
@Gerry Lamont: Vote for the Fair Dems party. They will abolish Inheritance Tax and Local property tax, like Sweden and other decent, fair societies.
https://x.com/FairDemParty
It will be replaced by a Financial Transaction Tax on trading stocks and bonds and a tax on Jet fuel which is Zeroooooo!
Money and properties already taxed going to your next of kin, and they tax it again. What happens if the deceased had no next of kin, will the government self tax itself of inheritance tax and give that tax to a charity? Because self taxing is simply going from one pocket to another. What happens if the government. Takes possession of the deceased assets?
@J Ven: they keep it, if no one comes looking for it. Like the doormant bank accounts.
Ah for the days when a house was a home and not a business, forgotten long ago it appears.
While there is a valid point to be made that inheritance is an enormous store of generational wealth the political reality is this is one of the most detested taxes.
Fact is almost everyone who is affected by this, votes.
When SF made their proposal for an increase, they started to lose the centrist vote they had been cultivating, only to lose a chunk of their base to the hard right subsequently over immigration.
@P. J.: no, there’s no valid point. Being forced to sell a family home because the children can’t afford the tax to keep it, is abhorrent. That home was provided and paid for nett off taxes already. Inheritance tax is double taxation and the thresholds are 20 years out of date…..realistically the threshold needs to be 750,000 – 1,000,000
FFG the tax party. They gave us every tax we have. One of the highest
@9QRixo8H: both of these parties are reducing taxes, only the looney left and Provos want to subject ordinary working people to higher taxes
@Pat Hazzard: 16th of Jan 2016 Leo Varadkar promised to abolish USC over the lifetime of the next government. 8.5 years later only the 4.5% band has been reduced to 4%…… Income tax take last year was €10.8 billion more than 2019. Vat was €7.5 billion more last year than in 2019. The 2019 takes were the highest ever back then….. FF/FG are creaming it in, expanding their departmental budgets, wasting it, while we’re all struggling with the cost of living…… Note I didn’t even mention the corporate tax take which is more than double 2019s take as well. Cowboys
@another one? what’s going on is the semi state sec: Promise a lot, deliver a little. That’s how you get elected
@Pat Hazzard: weird because in Northern Ireland they have much lower income taxes, houses that are 2 to 3 times cheaper, and unemployment rate at 2%. While FFG brought in the highest taxes and are now “reducing” what they done. Saviours against themselves.
@9QRixo8H: veeeerrrrrryyy slowly reducing them while taking in unprecedented tax takes. They took in €34.5 billion more last year than in 2019. 14 of that was corporation tax so the rest of it is from us!!!!
Shinners want to increase the tax and are wondering why their ratings are falling. Not a brain cell between them in that party.
I never liked the idea of being forced to sell an inherited family home in order to pay inheritance tax. BUT……. if somebody inherits a family home and THEN voluntarily sells it, there should be a sizeable wallop of Capital Gains Tax imposed.
@Sean O’Dhubhghaill: That’s a good idea. Not being able to afford the tax and HAVING to sell the home to pay it is very harsh. If there’s too much of a wallop, it might stop someone selling, therefore reducing houses coming on stream in the market. It’s a tricky one but I do basically disagree with the tax, especially as it is very high imo.
@Sean O’Dhubhghaill: No.
@Alex: To the CGT? Why?
@Sean O’Dhubhghaill: Say the parent sells up before passing. They want to give their children cash and they start renting/go into a home/ live with their kids……. Doesn’t sit right with me that the govt gets a sizable chunk of the cash gift from one family member to another….. No different from inheriting a family home….. And its capital acquisitions tax
@Sean O’Dhubhghaill: It could be paid in monthly instalments. It would still be far less than most people’s mortgage payments
@Sean O’Dhubhghaill: why? There’s no CGT on a primary residence. Nor should there be.
What country is he lecturing the Irish people from today, disgraceful watching him touting himself around the world. The hypocrisy of saying this trip has anything to do with Climate Change is lost on him, as he is shameless. Politics & leadership in Ireland is long gone & people have lost all trust in it. We have Despots running the country now, no better than some you would see in the Third World.
Money / Wealth / income that tax has been paid on should not be taxed again. Simple as.
And how is this going to help the Irish citizens burdened by the 2008 government failures. The leaders of that government collection 350k of state pensions instead of being in jail.
Why isn’t there an armed soldier on the buses in limerick, nothing a slug in the head wouldn’t solve
@James Moylan: I mean that worked really well up the North, the Brits were 100% successful in restoring law and order in a matter of a few days and everyone lived happily ever after…
Your children, who would appreciate any housing help ,should not have to pay tax on a house where taxes have been paid all the years that their parents lived in that house. Is there a legal basis for challenging the constitutionality of this “double taxation” ?
In Northern Ireland you can gift any amount of money to any person and so long as you survive the date of the gift by seven years there is zero IHT.
OAPS pay 40 percent on
Income over 18,000€ (450€) a week. Time for a change, long overdue.
@Sean Callan: that’s not true – every single person can earn up to 46k per year before the marginal rate applies. Also, 18k is not 450 per week.
@Social Guy: 42k actually. A lone parent is 46k
Farmers can pass on their property with virtually no tax and the same with business people. The PAYE workers are taxed all their lives and beyond when they want to help their family.
TAX PLANNING
buy a house for 10 million, get your kids to move into it for 3 years, Die, then the kids can sell the property 6 years later tax free.
@Unknown Unknown: one problem there…… How are you going to get a mortgage for it?!?!.
There is no need for a mortgage if you have the wealth. It’s just one of several methods to avoid tax.
As for getting the 10 million, EUROMILLION
@Unknown Unknown: Ah, I get it now
@Unknown Unknown: Have you ever wondered why super wealthy people borrow money from banks when they’re building/buying a home or making what would be a sizeable purchase for Joe Shmoe but a pittance to them?
How much rapidly inflating currency would these shrewd dealers dare to leave languishing in a bank?
@Unknown Unknown: lotto wins should be taxfree.
@Unknown Unknown: and you know the date of your death how, exactly… ?
This mass debate is pointless. This is one of the only fair ways to redistribute wealth and if the tax is properly targeted impacts maybe the top 1 – 3% of the richest families in a given jurisdiction. It’s always been a smoke and mirrors policy that distracts from real issues. Admittedly, given average house prices the band is a bit low at the moment, but the answer given here by MM was entirely appropriate.
They need to get money from somewhere, to pay for you know what
All you people giving out about this tax and Mehole can you answer a couple of questions. Did you all vote in the recent local elections? If you did vote was it for FFG and the greens? If the answer was no to the first one and yes to the second one I have little sympathy for you.
Will be looked at for them to have a better outcome and the common to get screwed
The whole nation has been made to feel inferior by the religious over the past decades and it is showing up now with us not being able to stand up for what is a no brainer when it comes to the penal inheritance tax threshold for children in this country. The tax on homes after a person dies should be abolished completely and it should have happened a long time ago instead we prefer to dig our heads into the sand.
Sinn Fein want to increase inheritance tax. I hope they don’t get their way we already pay too much.
Let’s pay no tax get rid of schools roads water sewerage doctors teachers civil servants and THE GOVERNMENT and let’s the clever disinformation/ misinformation lads in charge.Let dog eat dog and close down borders so we can just eat each other not eat asylum seekers etc The strongest will rise to the top and the country will be fabulous Gets rid of all woke whoever they are lefties and of course NO baddies like legitimately elected government as THEY are the main problem
have your say