Pearse Doherty (Donegal, Sinn Fein)
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De réir mar a mhéadaíonn praghsanna fuinnimh mar gheall ar an gcogadh, fuair an Economic and Social Research Institute, ESRI, amach go bhfuil duine as achan trí teaghlaigh anois ag maireachtáil i mbochtaineacht fuinnimh agus diúltaíonn an Rialtas seo gníomhú. Tá níos mó daoine ag titim isteach i mbochtaineacht fuinnimh agus iad ag streachailt leis an ngéarchéim chostais maireachtála agus tá seo do-ghlactha. D'iarr Sinn Féin arís agus arís ar an Rialtas seo cáinaisnéis éigeandála a thabhairt chun tosaigh, a thabharfadh faoiseamh do na teaghlaigh agus do na hoibrí seo atá ag streachailt. Tá saoránaigh ar fud na tíre seo ag iarraidh Rialtas a thacaíonn leo agus a chuireann in ord tosaíochta iad ach tá Rialtas againn atá ag fágáil ar leataobh iad.

As the Tánaiste hosted a private dinner last night to celebrate Fine Gael's decade in power, the ESRI was finalising its report on energy poverty in this State as prices increase at the fastest rate in 40 years. Today's report found the average household is now spending €2,000 more on fuel and energy, and this could increase by another €1,500. Prices are through the roof and people are struggling. One in three households now lives in energy poverty and this could rise to a staggering 43%, as the ESRI said this morning. The report states, "As fuel bills go up, it is people and families on lower incomes that suffer the most." It goes on to say, "In rapidly increasing numbers, households are facing the choice between putting food on the table, buying back-to-school clothes or heating their home."

Today's report paints a picture that is undeniable. Households who were already at the edge are now being plunged into energy poverty. This is the Ireland of today, with people, including working families, skipping meals or queueing for food parcels, something they never thought they would have to do. They are having to do it because the State is not supporting them but letting them fall through the cracks, and those cracks are getting wider. While Fine Gael toasted its success in government last night, the reality is many families are being pushed to the brink. The last thing they are thinking about is raising a glass to Fine Gael's success because they are worried about how to get to the end of the week, pay the bills at the end of the month or put food on the table for their children.

Facing these pressures, these families are confronted by a Government which refuses to take further action now. The Government has repeatedly ruled out measures to support households until October at the earliest, despite Sinn Féin calling on it week after week to take such measures. That is not sustainable, nor is it acceptable for those tens of thousands of families pushed to the brink. The Government is allowing struggling households to wither on the vine and its message to them amounts to "Buckle up because you're on your own". Government has a moral duty to support those who are struggling and protect the most vulnerable, but those who need it most have been left behind. This Government has refused to act.

I plead with the Tánaiste to change course and bring forward an emergency budget with the measures Sinn Féin has proposed, including cost-of-living cash payments to lower and middle-income households and a social welfare package that protects the most vulnerable from the cost-of-living crisis. Will the Tánaiste change course? Will the penny finally drop? Will he wake up, take action and understand that people cannot wait a further four months for him to bring forward a budget, and then whatever time after for him to implement it?

Leo Varadkar (Dublin West, Fine Gael)
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I thank the Deputy. That was a cheap shot. I hosted a dinner last night to thank colleagues for their years of service. There was no public money involved. Sinn Féin hosts dinners in America, charging people €1,000 per plate to attend, and the party leader flies first class to get there. That is what Sinn Féin does in the middle of a cost-of-living crisis. I believe she is about to announce another first-class trip to Australia, which she will undertake in the coming weeks. She will be clinking champagne glasses with the Trinity alumni in Australia and meeting the Australian business association. That is a cheap shot, particularly coming from a hypocritical party like the Deputy's, which receives millions in donations from vagabonds who live in a caravan-----

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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Anything to avoid the question. Your housing crisis, your health crisis, your childcare crisis.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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The Tánaiste, without interruption, please.

Leo Varadkar (Dublin West, Fine Gael)
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-----and that is one of the biggest landlords in the State, owning 50 properties-----

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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Anything to avoid the question, a Cheann Comhairle. I am being provoked again.

Leo Varadkar (Dublin West, Fine Gael)
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-----and from a person who operates his constituency office using public money from some sort of republican company. Cheap shots from Deputy Doherty should be seen for what they are by the Irish people.

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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Like they see the housing disaster.

Leo Varadkar (Dublin West, Fine Gael)
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I want to deal with the issue, having responded to the cheap shot. The ESRI report is stark. I do not think it is surprising to anyone in this House. We all know the extent to which petrol and diesel prices have soared in the past year. You only have to fill your tank or go into the forecourt to see that.

Mattie McGrath (Tipperary, Independent)
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Taxation.

Leo Varadkar (Dublin West, Fine Gael)
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We all know the extent to which the cost of electricity and gas has gone up. You only have to look at your utility bill to know that. People are feeling the squeeze. Some families are really struggling and having to make very difficult decisions about what they spend their money on because of the increase in the cost of living. These are largely driven by international factors, including the mismatch between global supply and demand and, in particular, Putin's war in Ukraine. If Deputies go to Northern Ireland, Britain, France, Spain or Germany, they will see they are experiencing the same problems we are because this is an international problem.

Government can help and is helping. In January we introduced €1 billion of budget measures, including an increase in the minimum wage, increases in welfare and pension and reductions in income tax for middle-income earners, which Deputy Doherty opposed. The average couple, both on the average income, would be paying €800 more in income tax this year if the Deputy was finance Minister, and that is a fact. Since then, we have introduced another €1.4 billion in additional measures. We have taken 20 cent of the cost of petrol and 15 cent off the cost of diesel. We are as low as we are allowed to go under European law when it comes to taxes on diesel.

Pearse Doherty (Donegal, Sinn Fein)
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That is not true

Leo Varadkar (Dublin West, Fine Gael)
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We cannot go any lower. I have confirmation on that in relation to diesel from the Minister for Finance today. We have reduced VAT on electricity and gas to 9%, which is the lowest it has ever been. We have taken €200 off people's electricity bills and introduced a targeted measure giving people on fuel allowance an additional €100. That is what has been done so far.

We accept we need to take further action to help people with the cost of living and are working on such action. The budget is three and a bit months away. We are working towards that, looking at the options and seeing what we might be able to introduce more quickly. Rather than waiting until January, February or March, we are seeing what we can do in October, November and December to help people before Christmas in relation to the cost of living. I do not rule out additional measures between now and then. We will continue to monitor the situation and see if prices moderate or continue to rise. I do not rule out interim measures but, as things stand, we have none planned and are working towards a budget package in a few months' time that will be in place for the winter and help people with rising costs.

Pearse Doherty (Donegal, Sinn Fein)
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The Tánaiste's opening gambit again displays how out of touch the Government is. I really thought as somebody whom the Director of Public Prosecutions is assessing whether to prosecute him under the corruption Act, he would be a bit more humble in his response.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Deputy Doherty, without interruption, please.

Pearse Doherty (Donegal, Sinn Fein)
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Let me put this to the Tánaiste. This report is not just expected. We knew it was going to happen because the Government has failed to act to protect the most vulnerable. This is a report of shame. One in three households is in energy poverty. The Tánaiste is not a commentator. He is the Tánaiste and the leader of a party in government. We need action now.

There are four weeks left in this sitting of the Dáil. There are people who are going to St. Vincent de Paul and people who are queuing up for food parcels today. There are people sitting at home wondering how they are going to meet their bills next week. They need Government action right here, right now. The Tánaiste says the Government will assess how prices work out in the medium term. Open your eyes. We know they are only going in one direction. The ESRI points that out. Energy prices will continue to rise in the autumn. Even if they do not, people are struggling in the here and now. They need action from Government. Is the Minister for Finance on board with bringing in new measures, which would be the first time, contrary to what the Taoiseach and the Minister have said? When will the Government make a decision on such measures?

Leo Varadkar (Dublin West, Fine Gael)
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That was another cheap shot-----

Pearse Doherty (Donegal, Sinn Fein)
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It was a factual shot.

John Brady (Wicklow, Sinn Fein)
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It was true, though.

Leo Varadkar (Dublin West, Fine Gael)
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-----and a very personal shot, which says a lot about the Deputy and the character of the kind of person he is. It is particularly strange coming from him because he was prosecuted. He abused and mistreated a member of An Garda Síochána. He was prosecuted for that and found guilty. He got away without a conviction because of his age at the time but he was actually prosecuted. He was arrested. That is what happened to him. There are a huge number of convicted criminals in his party and in the wider republican family, whether they be tax dodgers like Slab Murphy, a good republican according to Deputy McDonald - a good republican, a tax dodger - or people who have been convicted for murder. We know what his party's attitude is to rape and paedophiles and what it has done in that regard. The Deputy's cheap shots say a lot more about him than they do about me.

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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Shameful. Scraping the barrel, Tánaiste. Shame on you.

John Brady (Wicklow, Sinn Fein)
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Will the Tánaiste answer anything?

Pearse Doherty (Donegal, Sinn Fein)
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The people will decide.

Leo Varadkar (Dublin West, Fine Gael)
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The courts will decide, as they decided on Deputy Doherty. He was prosecuted and taken to court.

Pearse Doherty (Donegal, Sinn Fein)
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One in three are in energy poverty.

Catherine Murphy (Kildare North, Social Democrats)
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I listened to part of the Tánaiste's interview on Newstalk yesterday. I know he agrees with the President that the housing situation is now a disaster. However, he seems to have trouble figuring out who is responsible for that disaster. I will join some of the dots.

The Tánaiste and Fine Gael have now been in government for 11 years. For most of that time, there has been a housing crisis. His party has repeatedly told us that houses cannot be built overnight. Enda Kenny was one of the first to use that line in 2015. People have been listening to the Tánaiste's party acknowledging the crisis for eight years and now he is acknowledging that is not just a crisis, but a disaster. In 2016, Deputy Coveney told this House that not even rapid-build housing could be built overnight. Of course, it was never built so the Government tried something else. It brought in legislation for strategic housing developments that bypassed local planning procedures. That was supposed to speed up the delivery of housing but, in fact, slowed it down and eroded local democracy, creating great problems in the planning system. There is a real scandal in An Bord Pleanála in that regard that has yet to properly unfold. The Government brought in build-to-rent legislation that allows developers to build lower quality rental accommodation. Build-to-rent accommodation is now practically the only residential accommodation being built in Dublin city because it is the most profitable. In 2020, nearly 82% of residential schemes for which permission was applied for or granted in Dublin were build-to-rent developments, all of which come with sky-high rents. Where are people supposed to buy? People are being pushed out. One would start to wonder about the 15-minute sustainable communities. Some of Government's other innovations have been equally bad. It spent a long time trying to bring in co-living developments, that is, apartments smaller than car parking spaces for disabled people. It finally abandoned that idea and now mostly focuses on handing developers cash rewards of up to €144,000 for every apartment they build and continuing lucrative tax breaks for vulture funds.

Does the Tánaiste know how enraging it is for people who have been listening for years to promises that this crisis will be sorted out to hear the Government absolve itself from causing that crisis as if it is a disinterested party? What is he going to do to resolve this disaster, which he has acknowledged?

Leo Varadkar (Dublin West, Fine Gael)
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What I acknowledged yesterday is that the very real housing crisis we face in this country is a disaster for many people. It may not be for the 60% or 70% of us who are lucky enough to own our own homes, whether through a mortgage or outright, but it is certainly a disaster for people who cannot afford to buy a home and really want to and for people who are paying very significant proportions of their income in rent. I do not deny that is devastating for them and that there is a housing crisis, nor have I. I did not need to be told by anyone about the problems we face as a country. However, it is also the case, and it is just a fact, that the origins of this housing crisis lie in events that happened a very long time ago, when we had a property bubble that was followed by a banking collapse and a construction collapse. As a result of that, instead of building 30,000 or 35,000 new homes every year for a decade, which would have been the norm, virtually no houses were built for a very long time. We have a deficit of houses in the State. There are probably 250,000 fewer houses than we need. That is the origin of this housing crisis. The responsibility of those parties who are willing to be in government, and the Deputy's party has chosen not to enter government on several occasions, which is something we can come back to, is not to describe problems but to try to come up solutions and put them into action. That is hard. It is difficult work but it is work we are willing to do, unlike the Deputy's party.

The Deputy asked what we are doing about it. The main thing we are doing is increasing supply. On its own, increasing supply will not solve the housing crisis but we will not solve it without increasing supply. Where are we at the moment? Approximately 25,000 new homes will be built this year, more than in any year for a very long time. Approximately 35,000 homes are now under construction, more than have been for a very long time. Approximately 45,000 have got planning permission in the past year so you can see a real pipeline of new housing coming on stream. The Deputy probably saw the figures that came out yesterday. In April of this year alone, more than 1,000 first-time buyers bought their first home. As far as I can remember, it has been a long time since 1,000 first-time buyers bought a new home in just one month. That is not enough. I want to see it increase to 2,000 and 3,000 a month. That is where we intend to be. Among the reasons that is happening is our help-to-buy scheme. More than 30,000 individuals and couples have received help in buying their first home through that scheme in recent years. That is something the Deputy's party wants to take away from them.

Catherine Murphy (Kildare North, Social Democrats)
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I will address one issue with regard to the number of people who own their own homes. Many of them have family, children and grandchildren, living with them. People are squeezed into box rooms with no hope. With regard to this idea of segregating and saying that people who own their own homes are grand, many people are worried about their children. This is not a one generation issue but a multi-generation issue that people are concerned about.

Affordable housing is a key issue. Some 82% of planning permissions granted in Dublin relate to build-to-rent properties that will be provided at very high rents. The kind of city being built is unsustainable. The Tánaiste is hell-bent on keeping things on that particular track, which makes 15-minute sustainable cities unachievable because people are being pushed out further. Looking at the evidence, it shows it is not working, it is a disaster and the Tánaiste should acknowledge that.

Leo Varadkar (Dublin West, Fine Gael)
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There is one point on which I agree with the Deputy, which is that the housing crisis affects a great number of people in society in different ways, whether it is people experiencing homelessness, people paying unaffordable rents, people who want to buy their first home but cannot or people who own their own home but who still have adult children living with them, which they find very distressing on behalf of their children. I get that and so does the Government.

The Deputy touched on the need for affordable housing. She should look at what the Government is doing. Cost rental is a reality for the first time. The Deputy was critical of my party and that is fair enough, but that was a policy initiated by Deputy Coveney and Eoghan Murphy. It took a few years for it to happen because it takes a few years to build houses and apartments. People are now being offered cost rental accommodation for the first time. We need a lot more of it. The current Minister, Deputy O'Brien, is really leading the charge on shared equity schemes so that more people can buy their first home. There are also local authority loans for people who cannot get a mortgage from a bank. Thousands are now getting mortgages backed by the Government through local authorities to allow them to afford a home.

The Deputy has not been particularly supportive of those policies. I think that is a shame.

Catherine Murphy (Kildare North, Social Democrats)
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We do not support policies that drive prices up.

Bríd Smith (Dublin South Central, People Before Profit Alliance)
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When I was listening to the Tánaiste's spat with Deputy Doherty earlier, I was thinking this House must be full of bowsies. I, too, went to jail, along with dozens of other ordinary people, fighting the cost-of-living increase in 2003. Bin charges, which are now privatised, are going through the roof and vast profits are being made, and this is one of the issues in the current cost-of-living crisis. However, today's ESRI report is really startling and shows that there are many more thousands of people living in energy poverty than this Government ever calculated for. The Government calculates energy poverty based on the number of recipients of the fuel allowance. The ESRI calculates energy poverty based on the number of people spending more than 10% of their income on fuel. The number of households living in energy poverty has risen to 550,000. The measures the Government has introduced and which it goes on about, such as the increase in the fuel allowance and the €200 payment for electricity customers, do not even scratch the surface of what needs to be done. The Government must intervene between now and the budget rather than doing nothing in that period.

On Saturday, ordinary people will be staging an intervention by taking to the streets in around five cities throughout the country to protest against the rises in the cost of living. A huge chunk of society is being hammered and this Government has no plan to do anything substantial to address it. There are 200,000 households that do not get the meagre fuel allowance and do not benefit from any of the measures introduced as part of the household benefits package, which has not increased since 2013. There are 480,000 people who qualify for that.

The Government has quite a scandal on its hands and it is not doing anything to intervene to help people. What needs to be done is that workers and people on low incomes who are dependent on social welfare need a pay rise to match inflation. The reports from the public sector pay talks are worrying, and the Minister beside the Tánaiste will know, this, in that they indicate the Government is only talking about below-inflation increases. That will not cut the mustard at all. Workers and people on benefits need increases to match inflation. If they do not get that, the crisis will continue to spiral. Measures such as €100 here or €200 there will not do it. All the Government keeps saying is "mañana, mañana". What is the Government going to do today, tomorrow and before the kids go back to school in September to alleviate the struggles people are facing, including pensioners, people on social protection, workers, families and students, who also face massive costs and earn very little pay? The unions need to step up to the plate and put in pay claims that match inflation, and workers must insist they get that. That will set the benchmark and Government will then have increase social welfare benefits to match inflation.

Leo Varadkar (Dublin West, Fine Gael)
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Listening to the Deputy's contribution, somebody would be forgiven for thinking we had done nothing at all this year. We have taken a lot of action this year, including increases in the State pension, weekly welfare payments and the minimum wage. We are currently in negotiations with public servants about pay increases for them. A lot of pay increases are happening in the private sector at the moment. The Deputy mentioned students. We have made changes to the SUSI grant which will kick in in September. All of these measures have been taken in recent months. We are working towards additional actions on budget day that will make a difference in terms of helping people with the cost of living.

The Deputy mentioned the ESRI report. The ESRI is a Government body, and calculates energy poverty based on the number of people spending more than 10% of their after-tax income on energy. It is not the same as living in consistent poverty or being at risk of poverty or deprivation. It is a particular means of calculating it. Around 30% of households are now experiencing energy poverty, which shows that it is not just those on the lowest incomes who can experience energy poverty. Those on middle incomes can also experience it. That is why I stand over the decision of this Government to introduce universal measures as well as targeted measures. Those on middle incomes, working families and middle-class people are also feeling the pinch. That is why I stand over the decision of this Government to bring in universal measures such as taking €200 off electricity bills, as well as targeted measures such as the extra €100 for people on the fuel allowance. I think that will be the approach we will adopt going forward. We will introduce universal measures to help everyone, because everyone is hurting, and targeted measures to help those who are hurting most, namely, pensioners and people on welfare.

Bríd Smith (Dublin South Central, People Before Profit Alliance)
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There is a view, and it might be argued by the Ministers here, that if you give people a rise in their income, it leads to spiralling inflation. That is nonsense. There has not been a decent rise in income for most workers in this country for years. The ICTU reckons that over the past two years, workers have lost about €2,500 of their income because of inflation. The Tánaiste can say what he likes about the Government's interventions, but what we are talking about here in this cost-of-living crisis is a reality. We are not making it up. Everybody feels it. The Tánaiste himself has just outlined how middle-income earners feel it too. Middle- and low-income earners are workers, and they need a pay rise. The reports we are hearing from the public sector pay talks are quite worrying, because that will set the benchmark for everybody. That is why we are calling on people to get active on the issue and to insist their unions put in inflation-matching pay claims. It is not true that staff working in Tesco or ESB got inflation-matching pay rises. Over the years, the rises will average out at 2%, 3% or 4% at most. We have a real crisis on our hands. Giving workers and those on social protection an income that can match inflation will not cause inflation.

Leo Varadkar (Dublin West, Fine Gael)
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Looking at the facts and statistics, and the data are produced by the Central Statistics Office, CSO, so it is not my opinion; they are just facts, for the past few years up to this year, average earnings have risen faster than inflation. That is true in respect of the minimum wage, public sector pay and pay generally. This year is different. We are seeing unprecedented inflation and prices rising faster than incomes. As a result of that there must be a response. Part of that response is going to be bigger pay increases than had been planned in the private and public sectors. We are currently in negotiations with the public sector about that. However, we should not see pay increases as the only lever and the only mechanism for dealing with this problem. We can do other things too, for example, reducing the tax burden on people, reducing the cost of childcare-----

Bríd Smith (Dublin South Central, People Before Profit Alliance)
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What about taxing profits? There should be an increase in tax on profits.

Leo Varadkar (Dublin West, Fine Gael)
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-----and reducing the cost of public transport, as we have done. We have to see it as a package in the round. That is the way the Government is approaching it.

Noel Grealish (Galway West, Independent)
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The programme for Government promises to highlight inequalities and implement policies to do better by people. There is a sizeable group of people in this country who are suffering from inequality that follows them even when they have passed away. Today, I am asking the Tánaiste to tackle the unfairness of the situation that arises when a person who does not have any children of their own dies and leaves their house to a close family member. Currently, the child of a parent who dies does not pay tax on the first €335,000 of the value of what he or she inherits, but a beneficiary who is not a direct descendent, such as a nephew or niece, only enjoys a fraction of that tax-free allowance, even though he or she may have been the closest person to the deceased for decades.

According to a report by Daft.ie based on prices for the first quarter of this year, in Galway city the average asking price for a house is more than €335,000, while in Dublin it is well over €400,000. I will use the example of a house whose value is in between those figures, at €350,000, that has been left to a niece who has been unfailing in looking after the needs of her uncle or aunt for years, perhaps running messages, visiting them every day, bringing them to medical appointments and taking them on social outings, demonstrating a true family bond. The first €32,500 is tax-free, which is less than one tenth of what the house is worth. The niece will have to pay tax at the rate of 33%, or one third, on the remaining value of the house. That means that the niece must pay capital acquisitions tax amounting to more than €100,000. There are some very limited exemptions from inheritance tax for a favourite niece or nephew in certain situations, but they are very restricted.

Our current inheritance rules are effectively punishing people for not having children of their own. I am sure the Tánaiste will agree that that is wrong. These people have worked all their lives and have paid all their taxes, just like people who have become parents. In fact, those who have never married will have paid much more tax, having borne the brunt of our taxation system as single people who are doubly penalised. It is worth noting we have gone backwards in relation to tax-free thresholds. Until 2009, the tax-free allowance for a niece's or nephew's inheritance was more than €54,000.

I have in the past suggested changing the rules relating to a family home in pre-budget submissions to the Minister for Finance. My question to the Tánaiste is simple. Will the Government commit to changing this grossly unfair taxation regime when forming the next budget?

Leo Varadkar (Dublin West, Fine Gael)
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I thank the Deputy for raising this important issue. We believe it is appropriate to apply inheritance tax on transfers of wealth between generations. If people are taxed on earned income, it is only fair that people should also be taxed if they inherit income. It has always been recognised, however, that where the beneficiary is a child, including certain foster children, there should be a generous threshold before inheritance tax kicks in. These are called group A inheritors and the threshold is currently €335,000. A child can inherit up to €335,000 from a parent without having to pay any inheritance tax at all. It only kicks in on the amount above that.

However, the view has always been taken that where the beneficiary is a brother, sister, niece, nephew, lineal ancestor or lineal descendant of the disponer, a much lower threshold should apply due to the greater distance in relationship. This explains the current group B to which the Deputy referred, where the threshold is €32,500. It should be noted that in certain situations nieces or nephews may qualify for a favourite niece of favourite nephew release in respect of gifts or inheritances. In those situations, they are treated as though they were a son or daughter. Qualifying nieces or nephews are those who have worked substantially on a full-time basis for a period of five years prior to the gift or inheritance being given carrying on or assisting in the carrying on of a trade, business or profession of the disponer. For the nephew or niece to be deemed to be working substantially on a full-time basis in the business, he or she must work more than 24 hours per week at the place where the business, trade or profession is carried out or more than 15 hours per week where the business, trade or profession is carried out exclusively by the disponer, any spouse or civil partner of the disponer or the nephew or niece. That is the current situation whereby a nephew or niece could qualify as though they were a son or daughter.

The point the Deputy made is correct. I think that probably is too narrow. We should examine ways of broadening it. An example that occurred to me is a situation in which a favourite niece or nephew is acting as a carer and has been looking after an aunt or uncle in the last couple of years of his or her life. That is not counted. It counts if a niece or nephew worked in a business but it does not if the same niece or nephew was caring for an aunt or uncle, full time or part time, in the last couple of years of his or her life. In that case, the favourite niece or nephew status does not apply. There may be a number of such examples on which the Deputy and I could work together. We could change those rules. I do not think it would be right to change them wholesale and to treat every niece and nephew as if they were the same as a son or daughter but where there are particular cases like that, we could broaden the criteria. My office and that of the Minister for Finance would be happy to take that issue further with the Deputy.

Noel Grealish (Galway West, Independent)
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I thank the Tánaiste for his response. It is a different scenario in Northern Ireland and Britain. A niece or nephew in the same situation in those jurisdictions would not have to pay a penny in inheritance tax. Several other countries in Europe and around the world also make it easier for family members to hold onto the family home. Sweden, the Czech Republic and Norway have all scrapped inheritance tax. The same is true in Austria where a small property transfer tax must be paid instead. The niece or nephew being left a €350,000 house would pay little more than €40,000 in Poland, approximately €20,000 in Italy and less than that in Bulgaria. Australia, New Zealand, Canada and India are just some of the other countries in which no inheritance tax is paid. Will the Tánaiste commit to resolving the inequalities that exist in the inheritance tax system in Ireland for people who have no children and wish to leave their homes to a close family member?

Leo Varadkar (Dublin West, Fine Gael)
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I thank the Deputy. We are not going to abolish inheritance tax. As I said earlier, we think it appropriate that if we tax earned income for which people have worked, it is, therefore, also appropriate that we tax unearned income that people receive by means of inheritance, capital gains or other means but I agree that we should increase the thresholds over time. That threshold of €335,000 has been increased in recent years. It is supposed to be pitched around the cost of an average house so the average person could pass on the average house to a child without being liable for inheritance tax. As house prices rise, we need to continue to look at that threshold. It has been increased in recent budgets. We also need to examine the issue of a nephew or a niece being counted as a favourite nephew or niece, particularly if they have been involved in caring duties. I am not going to make a commitment to abolish inheritance tax because I do not agree with that. However, we can make changes to make the system fairer.