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We'll need €10bn in tax hikes if bailout fund cut, admits No side

A prominent No campaigner yesterday admitted that up to €10bn extra in taxes would have to be raised if the country was unable to access the EU bailout fund.

People Before Profit Alliance TD Richard Boyd Barrett was responding to the Yes side's warnings about European bailout funds being put out of reach if the treaty was rejected.

Although describing the warning of funding being cut off as a "false threat", the TD accepted if the country was not able to borrow, then the alternative was to raise taxes.

But the Government is adamant a Yes vote in the EU fiscal treaty referendum is necessary to provide continued access to the fund known as the European Stability Mechanism (ESM).

Mr Boyd Barrett claimed a wealth tax would raise up to €10bn. He also claimed the international markets would still loan money to Ireland, even if the country didn't repay its banking debt.

"We estimated prior to the Budget that we could get on higher income taxes on earners over €100,000, €150,000 and €200,000. You could get between €1bn and €2bn extra into the state coffers."

He said that through a 5pc wealth levy on the top earners, "the top most wealthiest people in this country, you could raise between €5bn and €10bn".

"That would go a lot further towards bridging the gap than anything this fiscal treaty proposes and furthermore it would allow us to begin to invest."

Tanaiste Eamon Gilmore said the No campaign was engaging in "lunatic economics".

And similar to his United Left Alliance colleague Joe Higgins during the TV3 debate, Mr Boyd Barrett struggled to explain where he would find the funds to pay for services.

Launching his party's campaign for a No vote, Mr Boyd Barrett was repeatedly asked about how he proposed bridging the gap between income and expenditure if Ireland had no other access to funding.

He said "wealth taxes" and "higher income taxes on the top earners" could bridge "most of that gap, if not all of that gap".

"Yes, there is a gap between revenue and spending when you take that out," said Mr Boyd Barrett. "That can be dealt with through progressive income taxation being imposed on the wealthier sections of our society through a wealth tax."

He also proposed not repaying the banking debt, but claimed this would not prevent the international markets lending more money to Ireland.

"If we say No, the idea that they're going to cut off our funding is nonsense . . . If they don't fund us, the European banking financial system collapses. That's the reality, so it's a false and hollow threat," he said.

Mr Gilmore said: "I think that's irresponsible and incredible. The reality is we export 80pc of everything we produce, the reality is the euro is our own currency -- it's not somebody else's.

"It's the money in our pocket and it is lunatic economics to be suggesting that you collapse your own currency. Nobody in their right mind suggests that -- the impact of that for workers, for our services for our country."

Irish Independent