Willie O’Dea TD, Fianna Fail Jobs Spokesperson has condemned the Labour Party’s capitulation to Fine Gael’s agenda to protect top earners.
He commented, “Until this afternoon, the Labour Party were very clear on the need for top earners to make an appropriate contribution to addressing the deficit. They pledged to tax those earning above €100,000 at 48%, reduce the overall level of tax relief on pensions, raise €100m through targeting tax exiles, raise hundreds of millions through abolishing legacy property reliefs and finally to increase the USC on those earning over €100,000.
“Today, all of these points of principle were abandoned with barely a whimper.
“The only measure introduced by this government to help low income workers today was a partial adoption of Fianna Fáil’s proposal to amend the Universal Social Charge. However, this small saving will be easily wiped out by cuts to social welfare payments announced yesterday. Unfortunately, they avoided adopting the progressive element of FF’s proposal, which would have increased the levy on those earning above €115,000, despite previous promises to ensure this category of workers would pay more.
“They also decided not to proceed with abolishing the legacy property reliefs that Fianna Fáil had proposed phasing out in last year’s budget. Instead, they have decided to introduce a measly property relief surcharge of 5% on investors with incomes above €100,000. This will raise €15million rather than the hundreds of millions that Labour had promised.
“Talk of pursuing tax exiles also turns out to have been little more than Gilmore hot air. They have tinkered around the edges of the domicile levy on non residents which we introduced last year but not to any significant extent. Labour’s promise was that they would raise €100m by targeting tax exiles.
“Last year Eamon Gilmore said “After this budget, ordinary taxpayers and social welfare will have been hit twice but the tax exiles will continue to fly in and out of the country without the inconvenience of having to pay tax.” (Eamon Gilmore National Recovery Plan 2011-2014 Statements 25th November 2010)
“Today, he was silent; as were the vast majority of his backbenchers.
“This Government has made political choices today. The choices made in Budget 2012 will be felt most by those on low incomes and those struggling to make ends meet while high earners will feel little impact. They are choices that the Labour Party must now live with.”