Sir, – Cllr John Kennedy (September 27th) argues that one ought to be able to inherit a house in Dublin worth €250,000 tax free. He considers a tax bill on the process of €71,775 to be “vast”, fearing that it “may enforce sale of the home”. His view seems to make about as much sense in this expensive Republic of equals as a hereditary peerage.
Receiving a home for the effective outlay of €72,000 can be dealt with in many ways. On a 10-year mortgage it would cost about €700 per month. This could be promptly cleared and might even be entirely covered by income from the rent a room scheme. Indeed, if one cannot handle such a modest mortgage, living in Dublin would appear essentially impossible. Renting a house for such a small amount would be inconceivable. It’s fair to point out that if the beneficiary was of the inclination to get up sufficiently early in the morning to earn €250,000 by their own efforts, over 44 per cent would be deducted at source. This loss equally may enforce sacrifices of various types. But as a society we need to incentivise people going to work. We don’t need to reward dying or incentivise the inheritance of unearned wealth. – Yours, etc,
Sir, – Cllr John Kennedy of Fine Gael is quite wrong in stating that if the proposals of the Commission on Taxation and Welfare were implemented, an only child living with a parent would have to pay inheritance tax above €32,000 when the parent died.
The home in such a situation is regarded by the Revenue Commissioners as, in effect, the child’s primary residence and he or she pays nothing.
However, I do agree with him when he states that a tax threshold of only €32,000 would deprive everyone, including working-class children, of a nest egg.
Mr Kennedy makes his remarks in a criticism of Fintan O’Toole’s opinion piece (“Fine Gael’s hysterical response to tax report is disgraceful and aims to stifle debate”, Opinion & Analysis, September 24th).
I say to both of them that a more effective way of combatting intergenerational poverty is to introduce an escalating rate of inheritance tax above a threshold of (say) €250,000.
Modest inheritance tax does not create intergenerational inequalities; that’s caused by the children of the wealthy receiving 67 per cent of millions. – Yours, etc,