| 8.6°C Dublin

Sinn Féin's Budget 2021 proposals include €1.5bn in tax measures mostly targeted at high earners and corporations

  • Party's alternative Budget would see extra €18bn spent next year, €6bn more than Coalition has flagged
  • Spending plans include restoring Pandemic Unemployment Payments and building 12,000 social homes


Mary Lou McDonald. Photo: Collins

Mary Lou McDonald. Photo: Collins

Mary Lou McDonald. Photo: Collins

SINN Féin is proposing €1.5bn of tax hikes and other measures mostly targeted at high earners and corporations to part-fund more than €18bn in extra spending next year.

The party would target people earning more than €100,000 and subsidies on what it terms "gold-plated pensions" as well as closing a "loophole" related to corporations and scrapping the Help-to-Buy scheme in its Budget proposals which are published today.

The extra spending in Sinn Féin's plan of €18.2bn, is more than €6bn more than the Government has signalled it will introduce on Budget Day.

Just a quarter of the extra spending in Sinn Féin's proposals over and above the sums the Coalition is expected to spend would be offset by what Finance spokesman Pearse Doherty described as "progressive taxation" measures.

The rest would have to be borrowed as Ireland faces another huge deficit next year due to the massive increase in spending due to the Covid-19 pandemic.

Sinn Féin say they would use the extra spending to restore the top rate of the Pandemic Unemployment Payment to €350-per-week at a cost of €1.5bn and deliver 12,000 social homes and 8,000 affordable rent and purchase homes at a cost of another €1.5bn.

The party also proposes reducing the VAT rate for the pandemic-hit hospitality sector from 13.5pc to 9pc for a year at a cost of €320m.

It would spend €522m to replace the Government's Stay and Spend scheme with a tourism and hospitality voucher worth €200 and €100 for every adult and child respectively.

And it would extend the commercial rates waiver until June at a cost of €520m.

Reducing the cost of rent by up to €1,500 for tenants and banning increases for three years would cost €257m, according to the party's plans.

The party also proposes cutting Local Property Tax by 20pc at a cost of €97m.

Sinn Féin say they would increase childcare workers' pay to the living wage of €12.30 and cut the cost of childcare by a third in 2021 at a cost of €70m - or €150.5m for the first full year.

Introducing an 80pc cap on capital allowances claimed against intangible assets on-shored by multinationals would raise €720m according to Sinn Féin's estimates.

Business Newsletter

Read the leading stories from the world of business.

This field is required

A wealth tax of 1pc on the portion of wealth held over €1m would raise €89m.

A 3pc "solidarity tax" on individual incomes above €140,000 would bring in €152m.

Removing tax credits on a tapered basis on incomes over €100,000 would raise €236m.

Reducing subsidies to "gold-plated pensions" by reducing the earnings limit and reducing the Standard Fund Threshold to €1.5m would raise €384m.

A second home charge of €400 would raise €64m.

Abolishing the Help-to-Buy scheme would save €100m.

Increasing excise by 30c on a pack of cigarettes would bring in €34m.

Mr Doherty said Budget 2021 is taking place "at a time of like no other" and he highlighted the uncertainty and hardship faced by many.

He said: "Our Budget is about giving certainty to workers and families… protecting them as they face continuing threats posed by Covid-19."

Mr Doherty argued that the Government's flagged budgetary strategy "is simply not enough to meet the challenges we face."

He said: "It provides only €900m to deal with pressures on day-to-day services. It commits to a level of capital expenditure that was already committed to over a year ago."

Mr Doherty said the increases in current expenditure his party is proposing is "offset by progressive taxation worth €1.5bn".

He said Sinn Féin's proposals would provides "a multi-billion stimulus that will create jobs, that will support incomes that will rebuild the economy", adding that the measures are "ambitious but they are necessary".

Mr Doherty conceded that the party's plans would see an extra €6bn in borrowing.

But he argued: "This is the time to make the investment in the economy.

"Indeed the question is not that we do too much, the danger is that as a country we do too little."

He said: "By doing too little it means that jobs could be permanently lost, it means that companies will not be supported, it means our economy will not recover in 2021."

He said the Irish Fiscal Advisory Council (IFAC) and the International Monetary Fund (IMF) are both advising that now is the time to borrow to stimulate the economy.

Finance Minister Paschal Donohoe reacted to Sinn Féin's Budget proposals by criticising the rival party for opposing policies that he said allows the country to borrow huge sums to respond to the Covid-19 crisis.

He said: "Sinn Féin were against all the major economic decisions over the past number of years that laid the foundations for our country being able to borrow a huge amount of money when we need it."

Mr Donohoe also said Sinn Féin will have to explain how they're calling for measures that he claimed they're "unable to implement" in Northern Ireland.

Sinn Féin plan extra spending of €18bn, more than the current amount of €12bn flagged by the Government for its Budget plans.

Public Expenditure Minister Michael McGrath said the €12bn represents spending on Covid-19 measures next year, core expenditure and preparing for a possible no-trade-deal Brexit.

He said it doesn't include sums that may be confirmed as part of Budget Day decisions.

Mr McGrath has been tight-lipped on the scale of a National Recovery Fund that he is expected to announce next Tuesday.

Sinn Féin's Mr Doherty has claimed that Mr McGrath plans to "pull the bunny out of the hat" on Budget Day.

Most Watched