Gilmore defends taxing maternity pay for working mothers
TANAISTE Eamon Gilmore has defended the decision to tax maternity benefit- which will cost working mothers up to €2,700.
The taxation of the benefit for the first time will begin on July 1, with mothers liable to pay tax at either the lower 20pc rate or the higher 40pc rate.
At Leaders Questions in the Dail, Mr Gilmore insisted that the decision was made because some mothers were getting more pay while on maternity leave than at work.
He said women would now have the same take home pay as they would at work.
"This is not a cut.You are twisting the situation on order to make a political point," he told Fianna Fail leader Micheal Martin.
However, the taxation of maternity benefit will mean women getting the average payment of €6800 in maternity benefit over six months will have up to €2700 taken back by the Revenue - bringing in an extra €40m per year to the State. Currently, working women only pay tax on the 'top up' payments by their employers which bring them up to full wages during their maternity leave.
Fianna Fail leader Micheal Martin said the move was excessive given the recent €10 cut in child benefit. He called on Mr Gilmore to reverse it.
"Women do not go on maternity leave to earn extra money. There are a lot of additional costs," he said