Social Justice Ireland calls for tax take to be increased
Social Justice Ireland today called on the Government to reform the taxation system with the target of raising the total tax take to 34.9% of GDP, from the current level of 27.4% which is among the lowest in the European Union.
Speaking at a seminar in Dublin on Budget 2010, the group’s director Dr Sean Healy said: “Producing a fair budget and working for a fairer future requires that Ireland stop benchmarking itself with Romania, Slovakia, Latvia, Lithuania and Estonia”.
Dr Healy pointed out that Ireland and these countries take the lowest proportion of national income in tax in the EU, have the lowest total Government expenditure and have the lowest social expenditure in the EU.
Dr Healy said Ireland’s total tax take as a proportion of GDP had fallen since the start of the present economic crisis – from 31.4% to 27.4% of GDP.
He said it was not possible to develop a country with EU-average levels of social services and infrastructure while having a total tax take that is far below the EU average.
“A fair budget that protects the vulnerable and the economy is possible..
“However, this requires Government to commit to increasing Ireland’s total tax take to a level closer to the EU average.
“This can be done while keeping Ireland a low-tax economy," Dr Healy said.
The group offered a series of proposals ahead of Budget 2010, saying that Finance Minister Brian Lenihan should increase taxation by €1.87bn, cut current expenditure by €1.5bn and reduce capital expenditure by €750m.
Among the recommendations were a call for the public sector pay bill to be cut by €520m and for a range of the McCarthy Report recommendations to be implemented.
The group also called for the implementation of all of the recommendations made by the Commission on Taxation, with the exception of its proposal to tax child benefits.
