UntyingTheInheritanceTaxLoophole
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In 2000, the then Fianna Fáil government introduced dramatic changes to inheritance tax law.
Those changes had an unintended consequence and in recent years were being used by very wealthy people to give property tax-free to their children.
This loophole could only be used by those in a position to purchase new properties outright, and was costing at a very conservative estimate €3.5 million a year.
Some families used it to gift several properties to their children.
In the single worst case, a parent transferred €4.2 million worth of properties to their four children: with each of the four houses worth €1.7 million, €1 million, €800,000, and €700,000 respectively.
The reasons behind the original changes remain unclear and the Department of Finance has looked for €200 in search and retrieval fees to release records relating to its introduction under Freedom of Information law.
From documents already released, it is clear the Revenue had concerns about it even then.
However, their request for a cap on the value of the property involved was disregarded by the Department of Finance.
If you can donate even a small amount, it will be possible to pursue this request and hopefully find out who pushed for this change, and more importantly why?
Was the loophole deliberate?
Was there awareness that this could be open to abuse?
Many of the tax loopholes we have heard so much about in recent years were introduced during a relatively short period of time around the turn of the millennium by Fianna Fáil governments.
Why was it so many of them seemed to benefit only those with enormous wealth? Was it just a coincidence?
I can't promise release of these FOI documents will solve the mystery but it will at least cast some welcome light on what was going on at the time.
For more on this story, you can read the background at: http://www.kenfoxe.com/2017/05/untangling-the-inheritance-tax-loophole-shedding-light-on-why-fianna-fail-government-introduced-the-changes/
Those changes had an unintended consequence and in recent years were being used by very wealthy people to give property tax-free to their children.
This loophole could only be used by those in a position to purchase new properties outright, and was costing at a very conservative estimate €3.5 million a year.
Some families used it to gift several properties to their children.
In the single worst case, a parent transferred €4.2 million worth of properties to their four children: with each of the four houses worth €1.7 million, €1 million, €800,000, and €700,000 respectively.
The reasons behind the original changes remain unclear and the Department of Finance has looked for €200 in search and retrieval fees to release records relating to its introduction under Freedom of Information law.
From documents already released, it is clear the Revenue had concerns about it even then.
However, their request for a cap on the value of the property involved was disregarded by the Department of Finance.
If you can donate even a small amount, it will be possible to pursue this request and hopefully find out who pushed for this change, and more importantly why?
Was the loophole deliberate?
Was there awareness that this could be open to abuse?
Many of the tax loopholes we have heard so much about in recent years were introduced during a relatively short period of time around the turn of the millennium by Fianna Fáil governments.
Why was it so many of them seemed to benefit only those with enormous wealth? Was it just a coincidence?
I can't promise release of these FOI documents will solve the mystery but it will at least cast some welcome light on what was going on at the time.
For more on this story, you can read the background at: http://www.kenfoxe.com/2017/05/untangling-the-inheritance-tax-loophole-shedding-light-on-why-fianna-fail-government-introduced-the-changes/
Organizer
Ken Foxe
Organizer
