first DM50,000 of taxable transfers and rises to 70 percent on taxable transfers in excess of DM100 million.

Most household effects, jewelry, cars, and boats are exempt from the inheritance and gift tax bases.

Greece

Greece imposes an inheritance tax and a gift tax. In the case of a Greek citizen, regardless of where he is domiciled, the tax applies to all property in Greece and movable property located outside Greece. For non-citizen residents of Greece, the tax applies to all movable property.

There are four different categories of heirs or transferees: parents, spouse, and children; lineal ascendant other than parents, lineal descendants other than children, siblings and their descendants, and certain illegitimate children; in-laws and foster parents; and all others. The first Dr1.5 to 20 million ($6,214 to $82,850) of transfers to a spouse and child is exempt from tax depending upon the number and age of the children. The first Dr.1.1 million ($4,557) of transfers to lineal ascendant, lineal descendant other than a child, sibling, descendant of a sibling, or illegitimate child is exempt from tax. The first Dr500,000 ($2,071) of transfers to an in-law or foster parent is exempt from tax. The first Dr300,000 ($1,243) of any other transfer is exempt from tax. For purposes of the exemptions and tax rates there is lifetime integration of gifts and inheritances. However, lifetime gifts from a parent to a child are taxed at half the ordinary rates for gifts up to Dr12million ($49,710). In addition, marriage dowries are taxed at half the ordinary rates and provided a larger exemption.

For the first category of heirs, marginal tax rates begin at five percent on the first Dr3.5 million ($14,499) of taxable transfers and rise to 25 percent on taxable transfers in excess of Dr20million ($82,850). For the second category of heirs, marginal tax rates begin at ten percent on the first Dr3.5 million and rise to 35 percent on taxable transfers in excess of Dr20 million. For the third category of heirs, marginal tax rates begin at 20 percent on the first Dr3.5 million and rise to 50 percent for taxable transfers in excess of Dr20 million. For the fourth category of heirs, marginal tax rates begin at 20 percent on the first Dr3.5 million and rise to 50 percent on taxable transfers in excess of Dr5 million ($20,173).

Iceland

Iceland imposes an inheritance tax and taxes gifts as income to the donee. There are three classes of heirs for purposes of the inheritance tax: next of kin; parents and children; and all others. Marginal tax rates on bequests to next of kin begin at one percent and rise to ten percent. Marginal tax rates on bequests to parents and children begin at one percent and rise to 25 percent. Marginal tax rates on all other bequests begin at one percent and rise to 45 percent.9

In its initial survey, the Joint Committee staff was unable to find any information on exemption amounts or inheritance tax bracket breakpoints.

Ireland

Ireland imposes an inheritance tax and a gift tax. Tax is imposed on all transferred property if the donor is domiciled in Ireland. In other cases the tax applies only to transfers of Irish property.

All inheritances received by a surviving spouse are exempt from tax. The first Ir£ 171,500 ($257,895) of lifetime transfers to a spouse during the donor's lifetime are exempt from gift tax. Children, and in certain cases grandchildren and nieces or nephews, are exempt on the first Ir£ 171,500 of inheritances. For certain other relatives (lineal ancestors, lineal descendants, and siblings) the exemption is Ir£ 22,900 ($34,436) and for others the exempt amount of inheritance is Ir£ 11,450 ($17,218).

For inheritances received by any class of heir, the first Ir£ 10,000 ($15,038) of taxable inheritance is taxed at a marginal tax rate of 20 percent. For inheritances in excess of Ir£ 271,750 ($408,647) in the case of a child, Ir£ 122,900 ($184,812) in case of other lineal descendant, lineal ascendent, or sibling, or Ir£ 111,450 ($167,594) in the case of the other heirs, the marginal tax rate is 40 percent. The gift tax rates are three quarters of the inheritance tax marginal tax rates.

Certain insurance policies are exempt from inheritance taxes. Government securities and certain stocks received by foreign persons also are exempt. The first Ir£ 500 ($752) received per year per donee per donor is exempt from gift tax.

Italy

Italy imposes both an estate tax, an inheritance tax, and a gift tax. These taxes apply to all transfers by residents and to transfers of Italian property by nonresidents. The spouse and direct descendants of the decedent are exempt from the inheritance tax, though not from the estate tax. The amount of estate tax paid is deducted from inheritances prior to calculation of inheritance tax liability.

The first 250 million lire ($156,152) is exempt from the estate tax. The first 100 million lire ($62,461) of a taxable estate is taxed at a three percent marginal tax rate. The marginal estate tax rate rise to 27 percent on taxable estates in excess of 3 billion lire ($1.873 million).

The inheritance tax is imposed on three classes of individuals: siblings and their directly descending kin; other relatives up to fourth cousins or their kin up to third cousins; and unrelated persons. For the first class of heirs, marginal tax rates range from three percent on inheritances between 100 million and 250 million lire to 25 percent on inheritances in excess of 3 billion lire. For the second class of heirs, marginal tax rates range from three percent on inheritances between 10 million ($6,246) and 100 million lire to 27 percent on inheritances in excess of 3 billion lire. For the third class of heirs, marginal tax rates range from 6 percent on inheritances between 10 million and 100 million lire to 33 percent on inheritances in excess of 3 billion lire.

The tax base of the inheritance tax is increased by 10 percent as a proxy for jewelry, furniture, and cash transferred.

Japan

Japan imposes an inheritance tax and a gift tax. An individual who acquires property by inheritance, bequest, or gift and is domiciled in Japan, or a Japanese national temporarily traveling or residing abroad, is responsible for any tax liability on worldwide property received. An individual not domiciled in Japan is liable for taxes only relating to assets received that are located in Japan.

The Japanese inheritance tax relies on the concept of "statutory heir." Generally, the statutory heirs are the children and spouse if surviving, with grandchildren substituting for pre-deceased children. If there are no such surviving lineal descendants, lineal ascendant or lateral relations are designated statutory heirs. The total number of statutory heirs determines the size of the basic exemption.

While a will may designate the distribution of property, the total tax liability of all transferred property is determined by determining the tax liability that would arise if the property were distributed according to what are referred to as "statutory shares." In the simple case, statutory shares would bequeath one-half of the decedent's estate to the surviving spouse and the remaining half divided pro rata among children of the decedent.

A bequest of up to ¥40 million ($392,927) plus ¥8 million ($78,585) times the number of statutory heirs is exempt from tax. For bequests in excess of this amount, marginal tax rates begin at 10 percent on the first ¥7 million ($68,762) and rise to 70 percent for bequests that exceed the exempt amount by ¥1 billion ($9.823 million) or more. Unrelated beneficiaries pay an additional 20 percent surcharge. If the surviving spouse inherits less than ¥80 million ($785,855) or less than the statutory share, regardless of size, a deduction eliminates all tax liability. Under age and handicapped children also receive additional credits against any tax liability.

The gift tax permits an annual allowance of ¥600,000 ($5,895). Beyond that exemption, gifts are taxed at marginal tax rates of 10 percent of the first ¥1.5 million ($14,735) of taxable gifts to 70 percent on taxable gifts in excess of ¥100 million ($982,318).

Korea

Korea imposes an inheritance tax and a gift tax. The taxes are imposed on the transfer of worldwide property for individuals domiciled in Korea. For nonresidents, the taxes apply to transfers of property located in Korea.

The first W60 million ($74,543) of any inheritance is exempt from tax. In addition, a surviving spouse may exempt an additional W100 million ($124,239), surviving children under age 20 may exempt an additional W3 million ($3,727), and persons who are over age 60 or handicapped may exempt an additional W30 million ($37,272). For gifts, W100,000 ($124) is exempt for tax annually. This exemption is increased to W1.5 million ($1,864) for gifts between relatives. However, this annual exemption is limited to W15 million ($18,636) per donor over any five-year period for gifts to donees who are direct ascendants or descendants of the donor. In the case where a donee is the spouse of the donor, the W15 million five-year limit is increased by W1.0 million ($1,243) for each year of marriage. The five-year limitation is W5 million ($6,212) when

the donor is a relative of the donee other than a spouse, direct descendant, or direct ascendant.

The inheritance tax and gift tax have separate tax rate schedules. The inheritance tax imposes a marginal tax rate of 10 percent on the first W20 million ($24,848) of taxable transfers and rises to a marginal tax rate of 55 percent on taxable transfers in excess of W1.0 billion ($1.242 million). The gift tax imposes a marginal tax rate of 15 percent on the first W10 million ($12,424) of taxable transfers and rises to a marginal tax rate of 60 percent on taxable transfers in excess of W500 million ($621,195).

A 10-percent discount on the inheritance tax liability is allowed for payment of the tax liability within a prescribed period.

Luxembourg

Luxembourg imposes an inheritance tax and a gift tax. The tax applies to residents, generally on all property of the deceased except for certain foreign property. For nonresidents, the tax applies only to certain immovable property in Luxembourg. The gift tax applies to all gifts of immovable property located in Luxembourg and to movable property represented by registered instruments.

Heirs in direct line of succession 10 and spouses in the case of a marriage producing children are exempt from the inheritance tax. The first LF1.5 million ($45,126) received by a childless spouse is exempt from inheritance tax. All other inheritances are taxable beyond a LF50,000 ($1,504) exemption.

For taxable transfer there are five different marginal tax rate schedules: childless spouse; siblings; aunts, uncles, nieces, and nephews; great uncles, great nieces, and great nephews, and all others. A childless spouse is taxed at a marginal tax rate of five percent on the first LF400,000 ($12,034) of taxable inheritances and at a marginal tax rate of up to 7.2 percent on inheritances in excess of LF70 million ($2.106 million). Inheritances of siblings are taxed at marginal tax rates beginning at 6 on the first LF400,000 of taxable transfers and rising to 17.2 percent on taxable transfers in excess of LF70 million. 11 Inheritances of aunts and uncles, nieces and nephews are taxed at marginal tax rates beginning at nine percent on the first LF400,000 of taxable transfers and rising to 17.2 percent on taxable transfers in excess of LF70 million. Inheritance of great uncles, great aunts, great nephews, great nieces are taxed at rates beginning at 10 percent on the first LF400,000 of taxable transfers and rising to 17.2 percent on taxable transfers in excess of LF70 million. Inheritance of others are taxed at marginal tax rates beginning 15 percent on the first LF400,000 of taxable transfers and rising to 17.2 percent on taxable transfers in excess of LF70 million. Inheritances received by non-profit organizations are taxed at marginal tax rates between 4 and 8.2 percent. 12 The gift tax applies at different rates on different donees. Gifts received by children of the donor are taxed at the lowest rate, 1.8 percent, while gifts to the spouse are taxed at 4.8 percent. The gift

10 Heirs in direct line of succession may be taxable at marginal tax rates of up to 7.2 percent on inheritances that exceed their legally specified share.

11 The top rate applies to inheritances in excess of LF70million.

12 Where the deceased was non-resident, marginal tax rates on spouses with children range from 5 to 7.2 percent. Direct descendants are taxed at marginal tax rates of two to 4.2 percent.

tax rate for gifts received by siblings is 6 percent; by aunts, uncles, nieces, and nephews, 8.4 percent; by great aunts, great uncles, great nieces, and great nephews 9.6 percent; by others, 14.4 percent. Non-profit organizations also are liable for gift tax at rates of 4.8 or 7.2 percent.

Mexico

Mexico no longer has Federal or State taxes on inheritances, gifts or donations. However, there is a title transfer tax of between 1.725 and 4.6 percent on transfers of real estate through inheritance, gifts, or donation. There also are stamp taxes assessed at between two and eight percent of value on gifts of real property. In addition, gifts to nonresidents are taxed at a flat 20-percent rate.

The Netherlands

The Netherlands imposes an inheritance tax and a gift tax. The tax applies to all transfers made by residents and to transfers of certain Dutch property by nonresidents.

For transfers between spouses, the first 522,791 Dutch guilders ($289,154) are exempt from tax. For transfers to children, the first 7,498 Dutch guilders ($4,147) per year are exempt from tax.13 On inheritances received by lineal ascendant or siblings of the transferor, the first 79,997 Dutch guilders ($44,246) are exempt from tax.

For taxable transfers there are three different marginal tax rate schedules: spouse and children; siblings and lineal ascendants; and all others. For children and spouses, the rate of tax rises from five percent on the first 37,349 Dutch guilders ($20,658) of taxable transfers to 27 percent on taxable transfers in excess of 1,493,692 Dutch guilders ($826,157).14 For siblings and lineal ascendant, the rates range from 26 percent for the first 37,349 Dutch guilders of taxable transfers to 53 percent on taxable transfers in excess of 1,493,692 Dutch gilders. For transfers to others, the marginal tax rates range from 41 percent for the first 37,349 Dutch guilders of taxable transfers to 68 percent on taxable transfers in excess of 1,493,692 Dutch guilders. In addition, gifts to charities in excess of 13,000 Dutch guilders ($7,190) are subject to an 11 percent tax.15 New Zealand

New Zealand imposes estate and gift taxes. The taxes apply to all transfers by persons domiciled in New Zealand and, in the case of transferors not domiciled in New Zealand, to property located in the country.

The estate and gift taxes have a unified tax rate schedule and the first NZ$27,000 ($15,957) is exempt from tax. The next NZ$9,000 ($5,319) is taxed at a marginal tax rate of 5 percent. Marginal tax rates increase to 25 percent for transfers in excess of NZ$72,000 ($42,553).

13 This annual amount may be increased once in each child's lifetime for children between 18 and 35 years of age to 37,343 Dutch guilders ($20,654).

14 The same rate structure applies to lineal descendants. However, the rate is increased by 60 percent for descendants twice and further removed.

15 The exempt amounts and tax brackets are indexed for increases in consumer prices. The amounts reported above are the exempt amounts and brackets in effect on January 1, 1994.