Speaking tonight (Thursday) in the Goat Pub, Goatstown, Brian Hayes MEP said that economic recovery and tax cuts should go hand in hand. Mr Hayes was speaking at a public meeting on the recent Budget organised by Dáil Candidate, Cllr Josepha Madigan.
“42% of all taxes come from income tax. Our taxation on work is too high. In 2002 the figure was 31% and amazingly was 27% in 2007. While we are not going back to that, we should be aiming that about one third of all taxes should come from personal income taxation. That will take some time to achieve, but we should work towards it in the next Dail.
“Taxation is an important part of the political debate ahead of the general election. Fine Gael has a very clear position on income taxation. We want to reduce the overall burden of income tax. We want to raise the threshold for entry to the higher rate of tax and to reduce the overall rates of income tax. Putting more money in workers’ pockets is the best stimulus possible to the domestic economy.
“If returned to government Fine Gael is committed to a policy of annual reductions in income tax and USC over a five year period. Other parties must also set out clear policies on income tax and the USC.
“Unwinding emergency tax measures should go hand in hand with the economic recovery. Reducing the overall levels of income tax is both fair and just. In the seven year period to 2014 most workers saw big falls in disposable income levels. As the economy recovers workers deserve a break.
“Of course there will have to be a close relationship between growth, sustainable government revenues and proposed tax reductions. EU Fiscal Rules will continue to apply.
“Tax cuts are also good for jobs; they keep the economy competitive by reducing pressure on wage levels. The Department of Finance estimates that a programme of reducing tax on incomes if continued at a steady rate would result in 20,000 extra jobs by 2020.
“Growing the economy, creating more jobs, broadening the tax base is all part of a prudent economic strategy. Taxation has a central role to play. Income tax as a share of the overall tax take is too high in Ireland because of the crash.
“As the election is now a matter of weeks away, we must hear from all parties and independents on their taxation policy. The populist nonsense that some mythical group are going to pay for everything must be exposed. The choice between tax cuts and better public services is a false choice. Creating a dynamic economy on a sustainable growth path will generate the revenues needed for better public services and a continuing programme of investment.”