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Cowen hints at further taxes and dismisses health rumours

TAOISEACH Brian Cowen last night left the door open for property and carbon taxes after confirming that it was not just income tax that would rise.

Mr Cowen also dismissed any suggestion of problems with his health.

Aside from continuing to soften up the public on tax hikes, Mr Cowen also ruled out a national unity government.

He said the country now needs a tax system that fits the new economic circumstances.

"We had a tax system based on growth and high employment where everyone was contributing. We now, unfortun- ately, have 10pc unemployment and growing.

"Taxes are going to go up. I said that at the ard fheis speech. There is no doubt about that," he said.

"Obviously income tax rates are going to go up and obviously also we have got to look at other areas where we can broaden the tax base because we have reduced tax on income," he added on 4FM's drivetime show 'McGurk On 4'.

Mr Cowen didn't rule out the introduction of a property tax or the return of rates.

"We have got to base this on ability to pay but also I've got to say that the gap is so big that everybody is going to be asked to make a contribution and those who can bear it most will have to bear it best.

"But as you say, we have built up a tax code at the moment where 40pc of our workforce are outside the tax net, where four-fifths of all taxpayers pay at a rate of 20pc," he said.

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Mr Cowen ruled out a national unity government involving the coalition teaming up with Fine Gael and the Labour Party.

"Well I'm not going to poo-poo, but I'm not saying it's a realistic one in the present circumstances," he said.

"We have in our parliamentary democracy a government and an opposition. It is open to an opposition to be constructive if they wish, to put forward proposals if they wish, but they have to be integrated. They have to be integrated into an overall hold which makes sense.

"And at the moment we have had a 'Coalition of Confusion' on the other side because the Labour Party has been saying that we need to be spending our way out of this problem and the Fine Gael party have been saying we've been spending too much. The bottom line for me is, you know, I've to do my job, which is to make sure that we deal with problems on the basis that we have a responsibility," he said.

Mr Cowen said the Government needs to better communicate the message.

"I often think a part of politics is psychology too that people have to get their head to where we are actually at. And a lot of people obviously would say: this has happened so swiftly and severely, how did this happen and you have to explain that.

"When we explain that better, people will understand what needs to be done.

"But I do think people now are at that point where they recognise this is an international phenomenon."

Mr Cowen also rejected suggestions there were problems with his health, or that he wasn't up to the job.

"I'm fine. My health is good. My job is to get on with the job," he said.

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