Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I thank the Minister for his reply. Reading between the lines, we are likely to see some movement on this issue in the budget in October. I hope it is a significant move because the changes made over the last few years have been quite drastic. This situation has been created by the increase in the number of people who are liable for inheritance tax, the significant increase in the rate, the dramatic cut in the thresholds and the rise in property prices over the last couple of years. Elderly people who are in a position to do so like to leave an inheritance to their children and they do not want much of that inheritance to be paid to the State by way of capital acquisitions tax. The issue needs to be addressed. I hope the Minister makes a significant move and examines the issue of indexation and the situation facing people who inherit a home and want to keep it but who find a large inheritance tax liability has crystallised. Under the existing arrangements, they can pay by instalments, but the interest rate is in the region of 8% per annum, which is quite punitive for many people. As part of the Minister's review, we should investigate whether that situation can be eased.

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