The Taoiseach insisted there are “many ways to skin a cat” as he made clear that the coalition has not yet agreed tax measures for the Budget.
Leo Varadkar was commenting on suggestions that the Government could move to introduce a cut to the Universal Social Charge (USC).
On Monday, Tánaiste and Fianna Fáil leader Micheál Martin confirmed that changes to USC are being considered by ministers.
The USC was introduced in 2010 amid the fallout from the financial crisis.
Mr Varadkar was asked about the issue on a visit to Belfast.
His Fine Gael party has previously pledged to abolish the charge entirely.
“I think we’ve made a lot of progress on tax reform and reducing income tax and USC in the past number of years,” the Taoiseach said.
“Somebody earning €40,000 today pays €3,000 less in income tax and USC than they did in 2014 and that’s because of decisions made in budgets by Michael Noonan, by Paschal Donohoe to both reduce income tax and reduce USC.
“The basic principle that we’ve agreed in the Programme for Government – all three parties have agreed to it – is that we will index tax bands and tax credits to bring about tax reforms that makes sure that people who are getting a pay increase this year – and most people will get a pay increase this year – don’t lose half or even more than half of that in income tax, USC and PRSI (pay-related social insurance).
“Exactly how we do that… there are many ways to skin a cat and we’ll agree that before budget day.”
