Bruton: income tax burden must be reduced
Jobs Minister Richard Bruton has said the burden of income taxation — particularly on average income households — needs to be addressed.
“I believe that if we are to sustain and accelerate the transition in our economy and the jobs recovery that has begun, this Government must continue to keep its promise to avoid any further increases in the burden of taxes on work.
“We must also — as soon as possible — begin to reduce the income tax burden, starting with hard-pressed families on average incomes who have endured so much over recent years, and put a little badly-needed extra cash in their pockets.”
He was speaking after the publication of Forfas’s latest annual costs of doing business study, which contains a raft of recommendations for furthering cost competitiveness.
The enterprise and trade advisory board has called for more action on lowering business-related costs, saying that, despite declines in recent years, Ireland remains “out of line” in many key cost competitiveness areas with its European neighbours.
Forfas CEO Martin Shanahan said: “Irish cost competitiveness has improved markedly over the last three years, or so. Now, we need to capitalise on these reductions and introduce further reform to make sure that these crucial price reductions become permanent.”
He noted that the Government’s action plan for jobs contained further measures for cost-competitiveness promotion.
“Despite significant improvements there is a lot more that needs to be achieved to reduce costs further. In addition to a sustained focus on business costs, the broader cost of living needs to be addressed if we are to create a virtuous circle between cost of living, wage expectations and business cost competitiveness.”
The wide-reaching study — which covers everything from utility and property costs to labour, transport, credit, and business service costs — said there should be “no further increases in the labour tax wedge”, while consideration should be given to making the lower national minimum wage rate payable to all workers under the age of 25.
Employers’ representative group Ibec responded to the report by reiterating its call for no further tax increases beyond those already announced, saying Ireland has one of the highest marginal income tax rates in the OECD. The Examiner.