Probate Tax has been abolished in the Budget at a cost of £30 million (€38 million) to the Exchequer in a full year.
The move has been welcomed by the Law Society, the Institute of Taxation in Ireland (ITI) and the Institute of Chartered Accountants in Ireland (ICAI).
Probate Tax was a 2 per cent tax on all legacies and was introduced in 1993.
The threshold for paying the tax was raised last year from £10,000 to £40,000. The tax was paid in addition to Capital Acquisitions Tax, or Inheritance Tax, where the thresholds are higher.
Mr McCreevy, in announcing the move, said he had always believed Probate Tax was an "invidious" one, penalising small legacies unduly. Probate Tax is being abolished in relation to deaths occurring on or after yesterday.
The director general of the Law Society, Mr Ken Murphy, said the society had campaigned "vigorously" against the tax when it was introduced and continued to oppose it since. "We very much welcome this decision."
Mr Murphy said one of the reasons the society was so strongly against the measure was that in some cases people had to pay the 2 per cent levy even thought the legacy they received was a non-cash one, such as a farm.
Mr Kieran Ryan, tax spokesman with the ICAI, said the association was "delighted" to see the tax abolished. Probate Tax was a very "bald tax" which never yielded a significant return, he said. "It arose with very small estates; had to be paid early; and in some cases had to be paid before people got the estates.
"It was awkward in that it happened at a time when people don't feel up to tackling the matter."
The tax was inappropriate. The use of Inheritance Tax was a much more logical system.
Mr Michael Mullins, president of the ITI, said the abolition of Probate Tax was welcomed by the institute.
The proposal by the Minister to apply the same rate of tax on foreign and Irish life assurance products has been warmly welcomed by the Consumers' Association of Ireland but criticised by the Irish Insurance Federation.
