Belfast Telegraph

Fine Gael committed to raising top rate of tax, says Taoiseach

Leo Varadkar previously committed to increasing the point at which people pay the top rate of tax to 50,000 euro.

Taoiseach Leo Varadkar (Niall Carson/PA)
Taoiseach Leo Varadkar (Niall Carson/PA)

The Taoiseach has said that his party is committed to raising the top rate of tax – but warned that without a majority, nobody gets “their entire way”.

Leo Varadkar previously committed to increasing the point at which people pay the top rate of tax to 50,000 euro for a single person or 100,000 euro for a two-income couple over the next five budgets.

The current terms of the confidence and supply deal between Fine Gael and Fianna Fail states there must be at least a 2:1 split between investment in public spending and tax reductions.

“Bear in mind what the confidence and supply agreement says on split between taxes and spending,” Mr Varadkar said.

Fine Gael will absolutely be arguing for Middle Ireland, for working people, for people on average and above-average incomes who pay the highest rate of tax far too soon Leo Varadkar

“It says at least two thirds should go on increasing the public spending.

“Actually we have gone way beyond that.

“If anything we are being criticised these days both by IFAC (Irish Fiscal Advisory Council) and ESRI (Economic and Social Research Institute).

“That we are spending too much and our tax increases aren’t adequate to keep up with wage inflation.

“They are more than inflation but less than wage inflation so you know we’re in a different space now than we would have ever anticipated – where we are being criticised by independent bodies for increasing spending too quickly and not reducing taxes more and we can certainly do that in the 2:1 parameters. That can be done.

“But bear in mind that is a commitment by Fine Gael, that is Fine Gael policy.”

Earlier this month, Fianna Fail agreed to extend its confidence and supply deal with the minority Fine Gael-led coalition government for the duration of 2019, citing Brexit as an extenuating circumstance for the country.

“Obviously independent ministers will have a huge role in the budget and Fianna Fail will have an influence on the budget as well.

“So it’s not that anybody gets their entire way in a budget but as a party Fine Gael will absolutely be arguing for Middle Ireland, for working people, for people on average and above-average incomes who pay the highest rate of tax far too soon.”

He added: “I don’t have a figure yet but as much as we can do. I couldn’t give you a figure today.”

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