This is the first time in a number of years that the Irish inheritance tax system has come under the microscope. The dramatic reduction since the financial crises in the amount that could be passed on tax-free only now seems to be penetrating the public consciousness.

In 2008, approximately €504,000 could be passed on tax-free between parents and children.

As the financial crises hit the country, that threshold was reduced to €335,000.

Special valuations

There were, and still are, special valuations applying to business assets, including farmland.

But as property prices have risen, the real value of these tax-free thresholds has reduced.

Practically all other sections of the community have had pre-2008 payment levels fully restored but the reductions in capital acquisitions tax thresholds have stayed and have neither been restored to their old values nor adjusted to take account of increased property values.

Different countries have different approaches. Many European countries have none; supposedly egalitarian Sweden being one of them but neither has New Zealand nor Australia.

On the other hand, South Korea has the highest level in the world while in Britain they are almost voluntary if you structure your affairs properly.

What is a sensible regime for Ireland? Most people, but not everyone, would agree with the principle of some tax on large inheritances but the rise in house prices in particular has meant that farming families find that if they attempt to significantly help offspring who are not farm inheritors to buy a house that they can run into an unexpected inheritance tax bill that can drain the farm of needed working capital and create real tensions within a family.

Resetting of allowances

A resetting of the allowances to at least reflect their earlier real values would go some way to correcting what has become an unintended anomaly.