Enda Kenny: 'Income tax cuts will be considered ahead of budget'
Published 12/02/2014 | 07:40
TAOISEACH Enda Kenny has said income tax levels here are too high and will be considered ahead of the next budget - but only if we can afford to deliver.
"We recognise that income tax levels are too high here. This is a priority for government, but you can only deliver it if you can actually pay for it," he said, at the IBEC CEO conference 2014.
He added that following the exit of the EU/IMF/ECB bailout programme, the Government's priority now is creating employment with a target of 50,000 net new jobs to be created this year and another 50,000 new jobs in 2015.
In an interview with CNBC, the Taoiseach also denied that multinationals that come to Ireland pay an effective corporation tax rate of as little as 2.2pc due to breaks like the "double Irish" - in the light of a recent report - stating that the rate is closer to 11pc.
"Ireland participates with all our colleagues at the OECD," Mr Kenny said, adding that tax law in Ireland required an international approach.
Ireland's corporation tax rate is already much lower than many other countries and is set at 12.5pc.
Earlier, IBEC chief executive Danny McCoy said that the tax burden is too high with our marginal tax rate one of the highest in OECD member states.
"Hard working families need a break," he said.
"At 52pc we now have one of the highest marginal tax rates in the OECD, well above the average of 36pc. It also kicks in at a low income level.
"The unfair pensions levy should also be dropped and excessive excise increases, which are way out of line internationally, should be reversed. This would boost sentiment, support domestic economic activity, and ultimately lead to higher exchequer returns."
He was speaking ahead of IBEC's CEO conference 2014 which is taking place today.
"Income tax rates are out of line and are a disincentive to work, consumption and job creation."
On investment policy, Mr McCoy said: "Historically low interest rates offer a unique opportunity to invest ambitiously in the country's future. We need to ramp up capital spending if we are to avoid the mistakes of the past, when significant infrastructure gaps constrained growth."