One of the most uplifting sights in the morning, when crossing the Curragh by car or train, is to see racehorses being exercised.
When the State was founded, its currency designed by a committee chaired by WB Yeats reflected Ireland's strong association with animals and agriculture. A horse (hunter) depicted on the half-crown headed the list of "simple symbols which all can understand as expressions of national products" (Foster, Yeats). The race meetings, the shows, the jumping competitions are integral to the Irish way of life.
The winning of the Gold Cup and nine other races at this year's Cheltenham festival by Irish horses was a stunning vindication of Ireland's equestrian industry, and of policies that have made this country a leader in horse breeding and training. Ironically, this occurred since a change of regime from 2008 was announced reluctantly by Finance Minister Brian Cowen, after insistent pressure from the European Commission and failing to persuade them to change their minds.
In naming his winning horse War of Attrition, Michael O'Leary, chief executive of Ryanair, is following the example of Parnell, who named his race horses President or Dictator, just to confirm all the worst fears of conservative unionists and nationalists, like William Martin Murphy.
At a much earlier stage of economic development, most productive activity was taxed lightly, if at all. In that regard, some central and eastern European countries are today where Ireland used to be.
In 1935, a commission of inquiry into the horse breeding industry under the chairmanship of Mr Justice Wylie (also known for his part in, prosecutions following the 1916 Rising, helping to save the life of Éamon de Valera), reported to the minister for agriculture, James Ryan. Apart from recommending a National Stud (established in 1946), it stated that one of the principal causes for the removal from the Saorstát of first-class sires was the assessment of income tax on stallions' fees under Schedule D, and the difference in the law in England. It may have been as much to do with British customs duty imposed on returning foals during the economic war. The tax systems were aligned in 1939. Later British tax changes actually helped the Irish industry.
When Charles Haughey as minister for finance introduced the stallion fee exemption in his 1969 budget as a consequence of abolishing income tax on farmers (that was reinstated a few years later), it ring-fenced the horse breeding industry for individuals and for syndicates, as recommended by another expert committee in the 1960s.
He had a personal interest in and knowledge of horses, derived from direct participation in equestrian activities, and understood the needs of the industry.
The late Thady Ryan, of the Black and Tans, a hunt based on the Limerick-Tipperary border (the beagles inspired the nickname for the paramilitary force in 1920-1), in his memoir A Privileged Life recounted a hunting accident, where CJH, about to jump a bank between bushes, was diverted by his grey on to a cattle track under a stiff thorn bush.
His face covered in blood, he exclaimed: "How can I attend the Dáil tomorrow in this state?" Inspecting the bank a year later, Thady found that Mr Haughey had killed the bush, rather than the other way round. Sceptics still cannot believe that riding accidents can happen to a minister at awkward moments.
His daughter Eimear Mulhern, who has a stud farm in Kildare, is currently president of the Irish Thoroughbred Breeders Association. Senator Paul Bradford of Fine Gael and I were the ITB's Seanad nominees to the Agricultural Panel in 2002.
Horse breeding is one of those activities where, generally speaking, note is only taken of the success stories. True, some owners and investors operate at arms length from daily management, although their involvement is vital to the industry. Those with closer involvement in looking after horses put in a tremendous amount of hard work, dedication, have a love of the way of life and need a resilient pocket. As for most small breeders operating on their own, the rewards are at best intermittent. Like everything else, it has to be done professionally, and even then there is a huge luck factor.
To illustrate the point, the number of foals born in North America between 1987 and 1996 that went on to win a grade one race was 0.2 per cent, and the number of foals by the top 1 per cent of sires that were that successful was 1.1 per cent. What is not understood about the stallion exemption scheme is that funds for the purchase of stallions at present may not be offset against tax, nor can losses be offset against profits made in other parts of the business.
There cannot be many so-called State aids where there is the potential for the Exchequer, at least occasionally, to bear a loss, but the commission was not inclined to listen to reason on this. In the Seanad this week, the Minister estimated the cost of this support to the industry as being somewhere between €4 million and €7 million in tax forgone, which could become tax refunded.
Nowadays, subject to regular political jibes, though even the Public Sector Times recently acknowledged the extraordinary entrepreneurial achievement of John Magnier, the industry once had unequivocal all-party support. Joe Bermingham, and Michael Ferris, then Labour TDs for Kildare and Tipperary South, in a joint party report outlined the employment value of the stallion tax exemption, equivalent to several average-size multinational companies, often in quite rural areas, and recommended its retention.
With nearly 40 years' benefit from a visionary incentive, it is important that whatever replaces it, following consultation with the industry and the commission, strengthens and consolidates Ireland's international flagship position, which benefits the EU as a whole, as several partner country breeding societies attested in their messages of support for retention of the incentive.