Taoiseach comes under fire from Martin over claims he did not hike taxes
Published 01/07/2015 | 02:30
Taoiseach Enda Kenny has been challenged over claims his Government did not increase taxes in its efforts to get Ireland out of the EU-ECB-IMF bailout.
Fianna Fáil leader Michéal Martin said that people had been astonished by the Taoiseach's comments which were simply wrong.
"You lose all credibility when you don't tell the truth," Mr Martin said.
The Fianna Fáil leader said 45 taxes had been increased to the tune of €3.5bn by the Fine Gael-Labour Coalition since it took office in March 2011. The most notable of these included an increase in VAT to 23pc and changes to the PRSI thresholds that had left most workers with big wage cuts.
Mr Kenny made his comments last Thursday in Brussels before a crisis meeting of the 19 leaders from the eurozone about Greece.
"In Ireland's case, we did not increase income tax, we did not increase VAT, we did not increase PRSI, but we put up alternatives to those measures that were proposed in order to keep a pro-growth policy and make our country competitive, grow our economy and provide jobs for our people," he said.
In the Dáil yesterday Mr Martin challenged the Taoiseach to admit he was wrong in what he said and to put the record straight. However, in response Mr Kenny rounded on Fianna Fáil and said that when it was in government in November 2010 it had agreed all sorts of cutbacks and tax hikes with the EU-ECB-IMF troika.
Mr Kenny said his Government had worked to cut VAT for the tourism sector, remove hundreds of thousands of workers from USC tax, and generally otherwise reduce taxes.
He said there had been no income tax increases in the years 2012, 2013, and 2014.
"We cut the VAT for the tourism sector and abolished the air travel tax, which helped to stabilise the industry and create 30,000 jobs," Mr Kenny said.
"We cut the lower rate of employers' PRSI by half for three years to encourage job creation, and we kept our promise not to increase the standard rate of employers' PRSI," he added.
The Taoiseach said he still hoped that a compromise could be reached with Greece. He said Ireland had put €350m into Greece's first bailout in 2010 but did not contribute to the second programme because this country was itself in a bailout.
Meanwhile, Sinn Féin leader Gerry Adams said Ireland should write off the Greek debt. He said many big business people, including businessman Denis O'Brien, were already getting comparable write-offs via Nama and the IBRC.
"Greece owes the State €300m. Denis O'Brien secured that much in debt write-downs from IBRC, a State-owned bank, and the Government thinks it is okay. The Government thinks debt write-downs are okay for some people, but not for the people of Greece," the Sinn Féin leader told the Dáil.