The Gazette 1971

Additional Imposition of Estate Duty

The Council of the Incorporated Law Society of Ireland

have expressed serious concern about the provision of

the Financial Resolution No. 7 on death duties recently

published. The resolution which takes effect in relation

to gifts made on or after 28th April 1971 substantially

reduces the present exemption from estate duty of gifts

made in consideration of marriage. Until April 28th last

such gifts were free of death duties. Under the pro-

posed change in the law only the first £5,000 will

be exempt where the gift is made by a parent or a

party to the marriage, and only the first £1,000 if the

donor is a remoter relative.

The Council believe that it is contrary to accepted

social policy that any further restrictions should be

made on the exemptions from estate duty in favour of

marriage gifts. Some years ago the period for complete

exemptions of all gifts was raised from three years to

five before date of death but the absolute exemption in

favour of marriage gifts continued. Under the Budget

Resolution, which requires confirmation in the forth-

coming Finance Act, a large number of agricultural

holdings will be brought within the tax net. Heavy

duty will be payable. Farmers and others who have

decided to transfer their land to children on marriage

will not have the psychological incentive to do so which

results from the present tax exemption which applies

even whent he owner dies shortly after the gift. It is

well known that many people are reluctant to part iwith

their property in favour of their children. Anything

which encourages the transfer of holdings from parent

to son is an incentive to business enterprise and the

adoption of modern farming and business methods as

well as being a valuable preventive for the evil of

emigration which is a most serious problem in the less-

developed parts of the country. The Council feel that

the practical and psychological effects of the change in

the tax law proposed in the Resolution represent a

serious reversal of social policy.

The new imposition of duty will cause particular

hardship in the case of the unexpected death of a

young husband leaving a widow and family. In such a

case there is often little ready cash to meet an unexpected

burden of death duties and stock may have to be sold

or a loan raised on mortgage at a high interest rate.

It is unfair to a young farmer, who may have involved

himself in heavy capital expenditure in modernising the

farm, to be suddenly faced with a heavy claim for

estate duty because the person who gave the farm to

him died without living for five years.

Big Pay Rises Amongst Top Executives

Ireland's top state and semi-state executives, including

the Taoiseach, Mr. Lynch, Cabinet Ministers, Dáil

Deputies, Senators, the Judiciary and senior civil ser-

vants, will all get a sizeable pay rise—if the Govern-

ment's Review Body recommends it.

Last night the Government announced that the

Minister for Finance had asked the Review Body on

Higher Remuneration in the Public Sector to "examine

the general level of remuneration" in these categories.

This move follows growing pressure, both inside and

outside the Dáil, for a wide ranging upward review of

all top executive salaries in the public service.

There was general feeling last night that the Review

Body will almost certainly recommehd higher salaries

all round. Many in these higher grades were not granted

increases at the time of the last two wage rounds.

This surprise announcement of the review comes only

nine days after Mr. Colley in the Dáil turned down an

application by Deputies in all parties for an increase in

their present Dáil allowance of £2,500 a year.

A G.I.B. statement said : "The Government have also

had under consideration the level of remuneration of

members of the Oireachtas and of the Judiciary in the

light of general pay movements over recent years. They

consider that it would be appropriate to have an exam-

ination made by an independent body of the remuner-

ation of those two groups.

"They have decided to avail for this purpose of the

services of the Review Body. The Review Body has,

therefore, been asked to examine and report on the

levels of remuneration of members of the Government,

Parliamentary Secretaries, the Attorney General and the

Chairman and Deputy Chairman of Dáil Eireann and

Seanad Eireann; allowances of members of Houses of

the Oireachtas and remuneration of the Judiciary."

The Review Body, which was set up in 1969, com-

prises Mr. Liam St. J. Devlin (Chairman), Mr. J.

Charleton, Major M. Donegan and two members of the

Labour Court, Mr. P. Doyle and Mr. J. Quigley.

Mr. Harold O'Sullivan, general secretary, Local

Government Officials Union, said these higher state

officials deserved to have their salaries reviewed. Higher

civil servants, he added, and higher local authority

officers, had missed out on some increases which their

more junior colleagues had been granted.

This caused a problem of differentials and it was only

fair that the Review Body should examine this, as it

wasa question of status.

The last increase in Dáil allowances was in 1967 when

Mr. Haughey was Minister for Finance. The Taoiseach's

total pay was increased to £8,000 a year, Ministers got

£6,000 and T.D.s £2,400 in 1969, after a call in an

Irish Independent

leading article, Mr. Lynch and his

Ministers took a 15 per cent cut in sympathy with

general restraint called for by the Minister for Finance.

The Judiciary got their last pay rise in 1968 when

District Justices were given £3,750 a year; Circuit

Justices £5,000; High Court Justices £6,000 and the

Chief Justice £8,000.

At the end of last year, the Department of Finance

proposed pay cuts of £1,000 a year for its top officials

by the removal of special allowances.

Irish Independent

(2nd April 1971)