Friday 20 September 2019

Taoiseach promises five years of tax cuts... Fianna Fáil hit back and say 'cool the jets'

  • Taoiseach promises five years of income tax cuts if Fine Gael wins the next election
  • Varadkar massively ups the stakes
  • Promises to increase threshold for top rate of tax to €50,000
  • Says Taoiseach said the current tax rates 'is holding our country back'
  • Micheál Martin hits out at Varadkar's tax cut pledge - urging Fine Gael to 'cool the jets'
Taoiseach Leo Varadkar speaking at the 79th Fine Gael Ard Fheis in Citywest today
Picture by Fergal Phillips.
Taoiseach Leo Varadkar speaking at the 79th Fine Gael Ard Fheis in Citywest today Picture by Fergal Phillips.
Taoiseach Leo Varadkar speaking at the 79th Fine Gael Ard Fheis in Citywest today. Picture by Fergal Phillips.
Taoiseach Leo Varadkar and Tánaiste Simon Coveney
Taoiseach Leo Varadkar at the end of the 79th Fine Gael Ard Fheis in Citywest today. Picture by Fergal Phillips.
Ministers at the of Taoiseach Leo Varadkar Fine Gael Ard Fheis in Citywest Picture by Fergal Phillips.
Taoiseach Leo Varadkar at the end of the 79th Fine Gael Ard Fheis in Citywest today. Picture by Fergal Phillips.
Taoiseach Leo Varadkar pictured speaking at the opening of the Fine Gael Ard Fheis Picture Credit: Frank McGrath

Kevin Doyle and Laura Larkin

Taoiseach Leo Varadkar has promised five years of income tax cuts if Fine Gael wins the next election.

As talks on the extension of his minority government’s lifespan enter their fourth week, Mr Varadkar has massively upped the stakes.

Taoiseach Leo Varadkar speaking at the 79th Fine Gael Ard Fheis in Citywest today. Picture by Fergal Phillips.
Taoiseach Leo Varadkar speaking at the 79th Fine Gael Ard Fheis in Citywest today. Picture by Fergal Phillips.

He used his televised Ard Fheis speech to turn on Fianna Fail, saying they are "not easy" to negotiate with.

"We know what we inherited from Fianna Fáil – broke banks unable to lend, ghost estates, Pyrite, Mica, Priory Hall, hundreds of thousands of people in negative equity, mortgage arrears, and hundreds of thousands of construction workers on the dole," he said.

Ministers at the of Taoiseach Leo Varadkar Fine Gael Ard Fheis in Citywest Picture by Fergal Phillips.
Ministers at the of Taoiseach Leo Varadkar Fine Gael Ard Fheis in Citywest Picture by Fergal Phillips.

But most of the attention focused on the big promise to reduce income tax rates for middle income families.

Mr Varadkar said the "reckless economic mismanagement of the past was unfair to all". 

Taoiseach Leo Varadkar at the end of the 79th Fine Gael Ard Fheis in Citywest today.
Picture by Fergal Phillips.
Taoiseach Leo Varadkar at the end of the 79th Fine Gael Ard Fheis in Citywest today. Picture by Fergal Phillips.

"It resulted in hundreds of thousands of jobs lost, public services slashed, taxes hiked and future generations burdened with a huge national debt."

He claimed Fine Gael had managed to reverse much of the unfairness "but some elements persist".

Taoiseach Leo Varadkar and Tánaiste Simon Coveney
Taoiseach Leo Varadkar and Tánaiste Simon Coveney

"For example, people on average incomes in Ireland pay the highest rate of tax. The average full-time income is almost €46,000 but in Ireland we pay the top rate of tax on just over €35,000.

"It discourages parents from returning to the workforce, discourages people who emigrated from coming home, and makes it harder to attract good jobs and talent to Ireland."

The Taoiseach said the current tax rates – which sees workers pay 40pc tax on earners over €35,300 – "is holding our country back".

"Fine Gael will end that unfairness. But we won’t do it in one big dramatic move – we have learnt from the mistakes of Fianna Fáil.  We’ll do it in a way that’s sustainable and affordable.

"Over the last 3 budgets, Fine Gael and the Independents in Government have increased the point at which people pay the higher rate of tax, but we must go further now," Mr Varadkar said.

He then promised: "So, over the next five budgets, we will commit to increase the point at which people pay the top rate of tax to €50,000 for a single person or €100,000 for a two income couple.

"We will end this unfairness and allow hard-working people keep more of the money they earn."

The move is likely to come under attack from Opposition parities who will see it as reminiscent of the Celtic Tiger years.

Mr Varadkar touched on the crises in housing and health in his speech.

On housing, he said: "Fine Gael believes firmly that every family should have a roof over their head, a place to call home.

"Fine Gael is the party of home ownership.  And now it is our mission to ensure that home ownership becomes achievable and affordable again for many who today feel it is beyond their reach.

"The housing crisis was many years and perhaps decades in the making."

In relation to health, Mr Varadkar said: "We are living longer and healthier lives than ever before. 

"Today more people survive cancer than die from it.  And survival rates for stroke and heart attacks are also improving. 

"Waiting times for operations and procedures are going down. 

"These things didn’t just happen by accident.  They were a direct result of Government policies and strategies, Government spending and resources, and the professionalism and quality of our healthcare staff.

"Now we need more, especially when it comes to seemingly intractable issues like hospital overcrowding."

Meanwhile, Micheál Martin has hit out at Taoiseach Leo Varadkar's tax cut pledge - urging Fine Gael to "cool the jets" on electioneering tax promises.

The parties are at loggerheads over when the review of the Confidence and Supply deal should end an renegotiation should begin and speculation about an imminent election has been ramped up by the Taoiseach's key address at the party's Ard Fhéis.

Mr Martin urged caution and claimed the pledge could cost anything up to €4bn. He said the pledge was reminiscent of those made ahead of the last General Election.

"Remember the last General Election... 'US style taxes and we'll abolish the Universal Social Charge (USC)'?

"That was a €4bn promise abandoned as soon as they got into government...so cool the jets in terms of the tax promises from Fine Gael.

"It was an election platforming speech...and again no costings attached to it."

In Citywest Fine Gael were keen to proclaim that they are ready for an election.  In response Mr Martin said all parties are ready for an election.

But he tried to play down the prospect of the country going to the polls in a snap election saying:

"The only people creating an aura of instability around the government is the government itself, particularly Leo Varadkar."

Mr Martin said it was clear some ministers, including Simon Harris, were keen for an election but again reiterated the need to avoid an election until a Brexit deal is ratified.

"I can't explain the sort of juvenile behaviours of ministers today," he said of various statements made by senior Fine Gael members urging that talks on a new deal need to begin.

Mr Martin also said the Government is not prepared for a no deal Brexit but said that there is "some distance" yet to go in the UK parliament in relation to getting the deal through the parliament, expressing optimism that the deal agreed between the UK and the EU this week.

Online Editors

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