A chara, – Once again Fintan O'Toole, the defender of the downtrodden, trumpets from on high ("A huge tax break for comfortable people", Opinion & Analysis, May 17th). This time the target is an inheritance from parents. He paints with the usual six-inch brush, covering all in his gallop for sainthood. The words "privilege", "luck", "windfall", "self-pity" and "cynical" are used as he takes a swipe at "comfortable" people. This is opinion, not analysis. Anyone who believes there is such a thing as an "incentive to be born of parents who can leave you a nice inheritance" is clearly more gifted than the rest of us. But not in the use of analysis. Thankfully I can get away from your columnist for a week or two – even if it is thanks to a "privileged, middle-class" holiday. – Yours, etc,
DIARMAID Ó MAONAIGH,
Santry, Dublin 9.
Sir, – Fintan tells us that a person who pays €72,600 on an inheritance of €500,000 is getting €427,400 free of tax.
In that case a worker who finds that she has a 52 per cent income tax liability on a salary increase of €100 has no grounds for complaint. Sure isn’t she getting €48 tax-free? – Yours, etc,
PAT O’BRIEN,
Rathmines,
Dublin 6.
Sir, – Alex Staveley (May 14th) argues that inheritance tax is justified because "a house worth over €500,000 may have only cost the parents €5,000 when they purchased it in the 1960s or 1970s. No-one paid tax on the €495,000 that came from the magic market."
This is a rather odd logic. Surely the obvious way to tax gains on housing assets is via capital gains tax – because an asset bequeathed to three relatives will not incur tax, whereas the same asset bequeathed to an only child will incur inheritance tax. Mr Staveley might ask himself where the money used to buy the house at a new inflated price came from; it came from the after-tax earnings of the younger generation – most likely highly leveraged under the new higher multiple lending standards.
A stock market investor who through foresight or luck bought Google shares at the initial public offering will be subject to tax on his or her gains, another person who realised similar gains via housing (there were several examples cited in your recent property supplement) is free to take his unearned gains and move abroad without paying a cent to the country whose economy and short-sighted housing policies created the gain.
It is notable that the US levies this tax (above a generous threshold and with allowances for moving home, etc). Those who cannot say a good word about the American tax system are curiously silent when it comes to our strange exemption. Middle-class welfare, perhaps? – Yours, etc,
MATTHEW GLOVER,
Lucan,
Co Dublin.