TAX EXEMPTION FOR STALLION FEES

NIAMH O'SULLIVAN,

NIAMH O'SULLIVAN,

Madam, - The Feedback poll in your Business section of Friday, February 7th asked the wrong question and as a result got the wrong answer.

You asked if "the special tax exemption for horse breeders" should have been abolished in the Finance Bill. The fact is that all bloodstock breeders are fully taxable on all of their sales. The tax exemption applies only to earnings of stallion owners from stallion fees and we are confident that this exemption will be justified by the planned Revenue assessment.

Your Editorial pre-empted such a study by describing the stallion fees exemption as being of "questionable benefit" and suggesting it should be abolished without objective assessment as to its value. Your suggestion that a 12.5 per cent corporation tax should be acceptable ignores the fact that stallion owners, with few exceptions, are sole traders and if they have a successful horse they would be subject to tax at the 42 per cent rate.

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Such a change would harm our bloodstock industry because it would hugely impair the acquisition of stallions by syndicates - the method necessary in relation to most purchases. If the quality of stallions in Ireland declines, the industry dependant on them will decline also. The bloodstock sector directly and indirectly provides secure employment for 25,000 people throughout rural Ireland.

Cliff Taylor (Business Opinion, February 10th) says: "We need a little better from our political leaders than a string of 'task forces/inter-agency/groups/sectoral studies' to respond to closures in the months ahead, as the inevitable eastward drain of jobs continues."

Given objective assessment and appropriate Government policy based on facts there will be no drain of jobs from our industry. We believe that judgment on this issue should await the outcome of the planned assessment by Revenue. - Yours, etc.,

NIAMH O'SULLIVAN,

Manager,

Irish Thoroughbred

Breeders Association,

Kill,

Co Kildare.