Abolition of USC for low earners will protect low paid and incentivise work

Fine Gael TD for Dublin North Alan Farrell has welcomed the measure announced in the budget by Minister Michael Noonan that the Universal Social Charge (USC) is to be abolished for people who earn less than €10,000. Up to now the USC applied to people who earned €4,000 or more.

“This will positively affect 330,000 people including the low paid, part time workers and students. This measure is a deliberate effort to protect the lowest paid, encourage spending, incentivise employment and help to keep people off the live register.

“As things currently stand the USC is unnecessarily punitive on the lowest paid in society. This Budget involves some tough measures but we are determined to be as fair as possible to the poorest and the lowest paid in society.

“We set out quite clearly in the Fine Gael election manifesto that we would review the USC which was introduced by the previous Government. This was because the bottom level of €4,000 was unfair to the lowest paid workers. I also believe it was counter-productive.

“Anecdotal evidence suggests that people are refusing jobs which pay barely more than the jobseekers benefit after the USC has been taken. This situation is no good for anyone. The individual remains on the dole and taxpayer picks up the tab. By abolishing the USC for the lowest paid we will help avert this situation in the future which will save money for the taxpayer.

“This Fine Gael led Government has been consistent in rewarding and incentivising work. One of the first actions of this Government was to reverse the cut in the minimum wage which was introduced by the last Government. As with the abolition of the USC for low earners we took this measure because we believe in rewarding and incentivising work. Furthermore we do not believe that the lowest paid should be punished for an economic situation which is not of their making.”