Updated at 10am
ANTI-HOMELESSNESS AND social justice campaigner Fr Peter McVerry has said he thinks the Government’s plan to cut the top rate of income tax is “pretty obnoxious”.
Ministers have been hinting for weeks that a cut is on the way, with Taoiseach Enda Kenny telling business leaders in a speech last night that next Tuesday’s Budget will be the “first step” towards lowering the highest income tax rate.
Kenny said the 52 per cent rate was “anti-employment and anti-enterprise” and that the package to be announced by Michael Noonan next week would be the “first step of a multi-annual plan” to bring it down.
However, speaking to reporters at an event in Dublin this morning, McVerry said he believed the plan wouldn’t do anything to help vulnerable groups.
“There are an awful lot of people in this country who are struggling,” McVerry said.
A lot of middle and low income people and I fully support any relief that can be given to them but to reduce the top rate of tax excludes those people and only provides benefit to those that are better-off in society and that I would find pretty obnoxious.
The current 52 per cent rate is made up of three components – 41 per cent income tax, 7 per cent Universal Social Charge (USC) and 4 per cent PRSI.
The coalition is expected to lay out its tax plans for the next three years next Tuesday, and the focus in this year’s package will be on changes to income tax and USC. It’s expected all three elements of the rate will be looked at as part of the overall plan.
Cabinet
Meanwhile, Ministers have been arriving for a Budget meeting this morning to discuss he finer detail of next week’s package.
Speaking on the way in, public expenditure minister Brendan Howlin confirmed there would be no further cuts from his Department next week, but said voters shouldn’t expect any extravagant spending.
“There is a very significant difference between where we thought we would be now and that is making further expenditure reductions of 13 hundred million euro [€1.3 billion] — and being able to undo some of the difficult decisions made over recent times.
So there will be no further cuts but that’s not to say that we can be profligate again. We can’t and we won’t be.
A broadly neutral Budget is expected next week. Further cuts and tax increases of €2 billion were initially planned by the Government, but Finance Minister Michael Noonan has said on several occasions recently that such a move won’t be necessary.
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