Coalition rift deepens over tax hikes
Published 07/01/2013 | 05:00
The rift has deepened between Labour and Fine Gael TDs over claims that there will be no more income tax rises during the lifetime of the Coalition.
Backbenchers are squabbling over a statement by Junior Finance Minister Brian Hayes that the Government has reached the limit on tax hikes.
His pronouncement sparked angry responses from Labour TDs and ministers, who say it is premature to rule out future tax increases.
Louth Labour TD Gerald Nash says the pre-Budget decision by Fine Gael to drop a 3pc increase in the Universal Social Charge (USC) for those who earn more than €100,000 came after a "lobbying blitz" from businesses.
Mr Nash says there are already generous tax breaks to attract foreign talent and business and blames Irish executives for killing the plans.
His comments came after Public Expenditure Minister Brendan Howlin said it was wrong of Fine Gael to resist tax increases on the wealthy.
The Programme for Government commits the Coalition against increasing income taxes or cutting welfare payments, but Budget tensions stretched this to its limits.