Friday 9 December 2016

NCC calls for a tax on property and flat-rate water charge

Published 09/11/2010 | 05:00

FINANCE Minister Brian Lenihan should tax property, restore college fees and add extra road tolls and introduce a flat tax for water consumption, the National Competitiveness Council (NCC) said in a pre-budget submission.

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Other suggestions include a new quango to vet budget changes, the abolition of tax incentives for property development and further charges for cheques while scrapping the tax on debit cards to force people to use electronic payments which cost less and prevent tax evasion, the NCC added.

"Solutions cannot be viewed in isolation," the Government-funded organisation said in its submission. "By prioritising actions to support the enterprise base to compete in increasingly competitive global markets we will go a long way towards resolving our fiscal and banking challenges."

Spluttering

Echoing warnings from the Economic and Social Research Institute last month, the NCC urged the Government to consider the best ways of cutting spending while not choking the already spluttering economy.

The council admits it can be difficult to protect the poor while also ensuring that there is some incentive to leave the dole and return to work.

The submission complains that single people in Ireland and their employers are now paying a similar amount of tax to the Organisation for Economic Co-operation and Develoment (OECD) average. Ireland has the sixth highest rate of income tax in the EU.

"Ireland has become significantly less competitive for higher-income earners," the NCC notes. A single person on 167pc of the average wage with no children must now pay 39pc of his or her income compared with the OECD-28 average of 39.3pc, it added.

Taxes on income will inevitably have to rise further without a property tax based on the value of houses, the NCC said. "Higher taxes on income act as a disincentive to people from remaining in or returning to the labour market."

The council has called many times for the abolition of stamp duty and a new property tax. It says that such a move is now a matter of urgency.

Irish Independent

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