SINN FÉIN HAS announced that it will scrap the Universal Social Charge (USC) on the first €45,000 of every worker’s income if they form the next Government after the General Election.

Mary Lou McDonald said her party will begin implementing this measure within the first 100 days of a Sinn Féin-led government, “ensuring the removal of the first €45,000 from the USC by 1 January 2026″.

She made the announcement this morning as the party launched its 71 candidates who are running in the election campaign. 

The USC was introduced in December 2010 by the then-Finance Minister Brian Lenihan at the height of the financial crisis. The measure came into effect on 1 January 2011. It currently brings in over €4 billion a year for the Exchequer. 

The threshold for exemption was initially €4,004 in gross income. This was raised in the following years, to €10,036 in 2013 and to €12,012 in 2014.The income level at which people pay the higher rate of USC has also been raised since it was introduced.

As part of Budget 2025, the Government announced that the 4% USC rate would be cut to 3%. 

Speaking this morning, McDonald said abolishing the tax would cost €1.8 billion in the first year and would mean up to €1,100 more a year in take-home pay for workers.

“This tax was introduced by Fianna Fáil at a time when they had crashed the economy, and for a long time, there has been a debate, not just within Sinn Féin, but across politics, as to how relief is brought, how there is a dividend for people who get up early in the morning and who work very, very hard,” she told reporters. 

McDonald said the measure will be at the heart of the party’s tax package and it is designed to give relief to every single worker, “but particularly for middle and lower income workers, this is a real win for them”.

“Most people who go out to work are not on huge runaway wages, and they are really, really struggling still just to make ends meet, week-on-week and month-on-month.

“We believe that this is a fair and appropriate response at this time to working people who need a break, need more money back in their pockets.”

Mini budget

The party’s finance spokesperson Pearse Doherty also confirmed at the launch that it will introduce a ‘mini budget’ within the first 100 days of a Sinn Féin-led government. 

“Ordinary workers can’t wait. We know the pressure that workers are under during a cost of living crisis,” Doherty said.

He said that abolishing the tax will be at the centre of the mini budget, which will mean an extra 1.3 million workers “will not pay the USC ever, ever again under a Sinn Féin-led government, and we won’t wait till 2026 to bring that about”. 

“We will see the abolition of the USC on the first €45,000 that every earner earns by 1 January 2026. That is our commitment. It’s a clear commitment, and it is what is needed right here, right now, and we are ready to deliver that in government.”

Doherty said the details of what else will be included in the party’s proposed mini budget will be announced in the coming days during the election campaign.

“But obviously, we are also not going to wait to deal with the issues of housing or health, and a number of other key issues such as childcare and a number of other matters which will be included in that mini budget,”

McDonald said Sinn Féin was conscious that other parties had made promises on the USC “that they never fulfilled”. 

She cited Fine Gael’s promise to abolish the tax during the 2016 general election campaign. The party has since dropped this stance, instead merging the USC with the PRSI levy after the 2016 election.

“The distinction is that we’re making this promise, we’re making this commitment, and further that it will come into play within the first 100 days of government,” she added.