There will be no income tax increase in the State’s economic recovery from Covid-19, a Fine Gael TD has said.
Deputy Farrell was speaking following the recent publication of a report by the Economic and Social Research Institute (ESRI) which stated income tax increases may be necessary to meet increased spending requirements.
“Income tax increases are not being considered as part of Ireland’s economic recovery from Covid-19. We will not penalise workers in Fingal with increases in income tax.
“When people return to work across Fingal, we want to get them back spending and saving – not paying increased tax.
“Fine Gael and Tánaiste Leo Varadkar has been quite clear on this issue. We will not be increasing people’s income tax.
“The Programme for Government 2020-2025 commits to no increases in income tax or Universal Social Charge for the lifetime of this Government. This should and will not be changing.
“The public health restrictions have been hugely detrimental to businesses and workers across Fingal and now is the time to help businesses recover and not penalise workers with increased income tax levels.
“Ireland is well placed for economic growth post-Covid without the need for an increase in income tax; the domestic economy is set to grow by 2.5% in 2021 and a further 7.5% in 2022.
“It’s also important to note that Ireland’s GINI coefficient, which measures income inequality on the basis of “after tax” disposable income, is below the OECD average. This points to the already strongly redistributive nature of the tax and welfare system in Ireland.
“Now is the time to get Fingal businesses up and running, get people working and get money back in their pockets.
“Ireland entered this crisis in a good position economically, with a €1.8 billion rainy day fund and a €1.8 billion surplus. This has helped us in our Covid-19 response and will continue to benefit us throughout our recovery.
“There should and will be no income tax increases,” Deputy Farrell concluded.