Belfast Telegraph

Sunday 28 December 2014

Budget 'must target higher earners'

Finance Minister Michael Noonan will set out the Budget on December 5
Finance Minister Michael Noonan will set out the Budget on December 5

An equality think-tank has piled more pressure on the Government to target high earners in the upcoming Budget.

Tasc said the state needs to close the gap between people on high and low incomes with major tax reforms.

Director Nat O'Connor pointed to recent claims from the International Monetary Fund (IMF) that it had underestimated how the Irish economy would perform under strict austerity measures.

"The next three budgets are not just about bringing taxation and public spending into line, they involve decisions that will shape Irish society for years to come," said Dr O'Connor, at the launch of Tasc's pre-budget submission.

"We need to envisage the kind of society we want and begin to plan what role public services will play in contributing to the quality of life for everyone living in Ireland."

She said if Ireland wants to achieve Western European standards of public services and welfare supports, the Government needs to make major reforms to the tax system to pay for it.

The independent think-tank said the Government could reach its target of 3.5 billion euro in December's budget by introducing an equitable model of property tax - that is based on ability to pay.

It also suggested reforming pension tax reliefs that benefit high earners, and increasing the Universal Social Charge and social insurance charged on salaries over 100,000 euro.

Tasc said its recommendations alone could help the Government make 80% of its targeted savings for 2013.

Ireland must save 8.6 billion euro over the next three years if it is to plug its massive deficit. Finance Minister Michael Noonan and Brendan Howlin, Minister for Public Expenditure and Reform, will announce the budget on December 5.

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