Proposed CAT threshold increase.

[Joe_90]

Currently anyone earning over €33,800 in income pays 49.50% on income over that limit.

The government is proposing to increase the Capital Acquisition Tax exemption to €500k.
http://www.irishtimes.com/news/irel...scrap-inheritance-tax-for-thousands-1.2646126

In an era of high personal income tax rates is there any justification for such exemption from CAT?

Due to the exemptions from CGT and these proposed increases you can see an example of €1.5m in wealth being divided between 3 children with no tax at all being paid.

What are the views of AAM?

 

[Gordon Gekko]

I earn an extra €100. I suffer income tax etc and end up with €48. I pass it on to my kids. They suffer CAT and end up with €32. They buy something. They suffer VAT and end up with €26.

74% taxation on my €100.

The €280,000 threshold and 33% rate are ridiculous.

 

[Sophrosyne]

The reason for the proposal is mainly due to rising property values, particularly in Dublin.

The increase has been recommended by various groups including [broken link removed] see page 19.

 

[rob oyle]

Here's one - any reason why capital taxes should be different to income taxes? Obviously they can't be applied exactly the same way but the aim should be that the effective rates on both fronts are equal?

 

[RobFer]

Here's one - any reason why capital taxes should be different to income taxes? Obviously they can't be applied exactly the same way but the aim should be that the effective rates on both fronts are equal?

Well there is the argument that capital gains tax in particular should be lower than income tax as an investor risks his money when he invests. The worker in the factory doesn't take risk losing capital by being employed. It probably doesn't apply to capital acquisition tax though.