[Sinn Fein]

21 January 1996

Real tax reform should top Quinn's agenda

Sinn Fein Monaghan County and Urban District Councillor Caoimhghín Ó Caoláin today called on the government to put real tax reform at the top of their agenda.

Councillor Ó Caoláin said:

``For several weeks now we have listened to politicians talk about a give away budget, a tax cutting budget, a pre-election budget but we have heard little about a fair and equitable budget? Never has there been so much hype about a Dublin government budget with all eyes focusing on what tax cuts and changes will make the news in Ruairí Quinn's third budget.

``Cuts in corporation tax, employers PRSI, the standard rate of PAYE tax and an increase in the taxable income thresholds have all been widely leaked as elements of Ruairí Quinn's voter friendly budget.

``The inequitable tax burden which falls disproportionately on PAYE workers has been a feature of the 26-County economy for decades. Why then is Minister Quinn set to announce the second cut in corporation tax in two years and also a cut in employers PRSI.

``Cutting employers PRSI has been an ongoing campaign of employers organisations throughout the 1990s. Already we have reached a position in the EU whereby only Britain has a lower employer's PRSI tax. PRSI is a levy that secures employees working conditions by ensuring they have access to sick and disability pay, pensions and unemployment benefit.

``Cutting the levies that contribute to this funding will ultimately lead to cuts in the social welfare budget. The cut in employers PRSI means yet another subsidy for business paid for by the section of the population which can least afford it.

``Cuts in the rates of PAYE will be welcomed by workers throughout Ireland. However decreases in the rate of tax should not be confused with genuine tax reform. Real tax reform must have at its heart a commitment to the principles of equity and fair play. There must be no double taxation. Everyone who earns an income from whatever source should be taxed.

``Ruairí Quinn's aim should be to create a system whereby everybody carries an equitable share of the tax burden. Only when these objectives are at the top of Ruairí Quinn's agenda will we be truly on the way to tax reform moving away from a tax regime designed to penalise the most powerless and protect the vested interests who created such an unfair system in the first place.''

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