Another nail in the coffin.

The taxation of share options is proving just as contentious as accounting for them. Ronald LeMay and William Esrey, respectively president and chief executive of Sprint, a U.S. long-distance telecommunications company, have had to resign because a potential multi-million-dollar tax liability on their gains from exercising stock options in the company threatens to bankrupt them. In Ireland, a finance bill recognizes that it has affected many ordinary employees in Ireland's high-technology businesses, some of them subsidiaries of American multinationals. The bill proposes allowing those who have exercised options at a price above the current market price of the shares to defer any tax liability arising from the transaction. In Britain, broad-based employee share-option schemes are treated more generously than those granted to only a few top individuals. Nevertheless, the taxation of stock-option gains in Britain has been thrown into confusion by a case brought before the Court of Appeal. The rules for taxing gains on stock options are unclear everywhere. This uncertainty, added to the long-drawn-out fall in equity markets, has sharply reduced their appeal.