'If you don’t have children, you are at the bottom rung of the tax ladder'

Campaigners to meet Tánaiste and Taoiseach to make case for inheritance tax reform

End Discrimination in Inheritance Tax members Deirdre Quinn, Maureen Madigan, James Sexton, Jean Cashman, Kieran Sexton, and Brigid Timmons.

Campaigners for reform of the inheritance tax system say Ireland’s superrich have found loopholes to avoid inheritance taxes while 1m childless citizens remain “at the bottom rung of the tax ladder”.

The campaign by End Discrimination in Inheritance Tax (Edit) seeking to change Ireland’s inheritance tax structure will hold a series of discussions at Leinster House this week, starting with Tánaiste Simon Harris on Tuesday and concluding with Taoiseach Micheál Martin seven days later for talks which they believe will result in reform of the system in the upcoming Budget.

Edit is calling for an index-linked lifetime tax free threshold to replace the existing inheritance tax structure, which they view as discriminatory against childless citizens. Edit co-founder and spokesperson James Sexton from Cork says fears that such reforms of the system will lead to tax avoidance are unfounded.

“Already, there’s a very real reason a select group of billionaires are buying large swathes of agricultural land, which will allow their heirs to inherit at very favourable tax rates. It’s up to Government to ensure there are no loopholes,” said Mr Sexton.

“There’s another set of rules for every other PAYE worker, and if you don’t have children, you are at the bottom rung of the tax ladder.” The Edit campaign seeks reform of inheritance tax laws so that all citizens have the same entitlements to passing on their assets. Under existing rules, Capital Acquisitions Tax is payable at 33% above certain thresholds. The threshold for parent to child (Group A) is €400,000 but the threshold to siblings, nieces and nephews, and grandchildren (Group B) is €40,000. For all others – including close friends, unmarried partners, carers (Group C) - the threshold is €20,000.

Mr Sexton, a teacher from Model Farm Road in Cork, has called the system discriminatory against citizens without children, and has called for changes to make the system “fair and equitable”.

He says that if he and his wife Sheila choose to pass on their home to a niece or nephew, it will have to be sold, as capital acquisition tax will simply make it unaffordable to keep in the family.

"So many people do not know what is coming down the track, until they are faced with the situation, based on their childless status. There has been an attempt to conflate cuts to inheritance tax to inheritance tax reform. We simply want whatever rules that apply, to apply to all citizens fairly.

“We have presented a solution: the introduction of an index-linked lifetime tax free threshold of €460,000 to be available to every citizen. That will remove the inequality and the discrimination faced by the families and loved ones of childless citizens.” Mr Sexton said Edit has costed the proposal and estimates that it would cost €500m to bring citizens in Group B and Group C into a new single threshold. “There is a cost to equality, no doubt. But a progressive taxation system can be applied to inheritances received above the €460,000 mark and that would be fair and equitable to every citizen as well. But these are obviously political decisions for the Government, not for us.” Mr Sexton will lead a four-person delegation in a meeting with Tánaiste and finance minister Simon Harris and his departmental officials at Government Buildings on Tuesday, July 7.

Later that day, they will meet Senator Gareth Kelleher and members of the Fine Gael parliamentary party to lay out their views. On Wednesday, then will meet Independent Ireland members before a meeting with independent TD and Minister of State at the Department of Transport Sean Canney.

The campaign has previously received support across the political divide from minister of state Jerry Buttimer, MEP Billy Kelleher, TDs Ken O'Flynn and Catherine Ardagh, and Senator Laura Harmon.

On Tuesday, July 15, they will meet with Taoiseach Micheál Martin to further press their case.

“We met with Simon Harris two months ago and I believe he understands the situation. He accepts and acknowledges that this system is discriminatory and has said that he is prepared to reform it, so obviously we'll have to see what comes back to us with on Tuesday.” Mr Sexton and his wife Sheila, and other Edit campaigners have pressed their case for inheritance tax reform over the past 18 months. The group come from various backgrounds: some married, some single, some in same sex relationships but virtually all in a situation where they say can not pass on their assets to loved ones in the same way as parents to children.

“Unfortunately, at present every childless citizen, their families, and the loved ones of childhood citizens are not being treated equally by our inheritance tax system,” said Mr Sexton.

“This should be addressed, reformed, and solved in Budget 2027,” said Mr Sexton. “We understand there is always going to be competing demands, but fundamentally, this is an equality issue. It just so happens that it pertains to inheritance taxes. We're all equal citizens, or we're not.”