Fine Gael tax cut will only benefit 20% of society - Tóibín
Sinn Féin TD Peadar Tóibín today accused Fine Gael of allocating over half of the public spending allowed under EU rules for 2016 to a single tax cut that will only benefit 20% of society.
The Sinn Féin Junior Finance Spokesperson said:
“A budgetary ‘Expenditure Benchmark’ that dictates the levels of extra expenditure that the government can make may be breached next year as a result of the Taoiseach’s promises to grant a €292 million tax reduction to upper earners. Another downwards adjustment of €1,000 at the level at which the higher rate kicks in would exceed the benchmark.
“Under the EU’s ‘six-pack’ Stability and Growth Pact arrangements Ireland will only be allowed a net 0.6% expenditure increase next year.
“Tax cuts are also counted as expenditure under this rule. Figures from the Finance Minister show that this rule equates to only €400 million permitted expenditure.
“As we know Ireland is still suffering from seven damaging austerity budgets, a lack of investment in critical infrastructure and unjust tax measures that have hit worst those least able to afford it.
“We know that there are significant demographic pressures, infrastructure pressures and there have been calls public sector pay cuts for the lowest paid to be reinstated.
“Fine Gael has already assigned over half of the spending provided for under EU rules to a single tax cut that will only benefit 20% of society.
“When I raised these concerns with the Fiscal Advisory Council during today’s Finance and Public Expenditure committee meeting representatives of the organisation admitted that there would be penalties imposed on the country if this expenditure benchmark is breached.
“During the Austerity Treaty campaign Sinn Féin argued against signing up rules that in effect allow the EU dictate Ireland’s fiscal policies. Unnecessary and unjust fiscal rules will only compound the damage caused to the economic and society imposed by a protracted period of austerity.”