Taxation body calls on Government to abolish new levies
Wednesday April 01 2009
THE various income tax levies, like the income levy and the health levy, should be abolished and instead combined into the income tax rates, the Irish Taxation Institute said in a pre-Budget submission.
But it will not be possible to do this quickly and so it may have to wait until 2010, the institute said.
It also said raising the higher rate of tax too much will put the brakes on entrepreneurial drive, while workers would be less inclined to improve their productivity.
Chief executive of the Irish Taxation Institute (ITI) Mark Redmond also called for a reduction in employers' PRSI, which is currently 10.75pc. This measure is a tax on employment and should be replaced by a tax deduction on staff costs.
Any tax rises in next Tuesday's crisis Budget should be matched, euro for euro, by public spending cuts, it said.
ITI advised against any further changes to the current tax measures that encourage taxpayers to provide for their pensions.
Now is not the time to remove any assistance to taxpayers to fund their own pensions, thereby reducing the future burden on the State, Mr Redmond said.
He added: "We fully recognise that government needs to raise a significant amount of money to start clawing back the alarming deficit that has built up so rapidly.
"Our overriding message to government is that a focus on maintaining jobs, combined with simplicity, evidence of stimulus and a strategic, long-term plan for recovery, are the things that will resonate best with all sectors, employees, public or private sector, employers and social partners, and will get everybody aligned in support of the changes required."
- CHARLIE WESTON
