Tax concessions worth £846 million (€1.1 million) are being sought for the PAYE sector in the forthcoming Budget by the Irish Congress of Trade Unions. These are aimed at taking 80 per cent of PAYE workers out of the top tax band and ensuring that nobody on the national minimum wage is liable for income tax.
Presenting the ICTU pre-Budget submission, general secretary Mr David Begg said: "The Government should not allow current difficulties in the global economy to deflect it from staying the course to achieve a prosperous and socially cohesive society."
He argued that further reductions in income tax, promised under the Programme for Prosperity and Fairness, could "underpin consumer confidence" and provide a boost to the economy.
However, he believed this had to be based on tax cuts targeted at the middle to lower income groups.
ICTU wants personal tax credits increased by £160 a year to £1,260, a rise in PAYE tax credits of £300 to bring the figure to £700 a year, and the standard tax band widened to £2,000 a year. But it says married couples with only one spouse working should have their standard rate band widened by just £1,000.
The cost to the Exchequer of increasing personal tax credits by £160 a year would be £290 million. The cost of the higher PAYE tax credit would be £360 million and the cost of the increases in the standard rate band would be £196 million, making a total of £846 million in total. The tax reforms are similar to those sought by SIPTU at its recent biennial conference in Tralee as a minimum requirement for meeting targets agreed in the PPF. ICTU will also seek greater recognition of child-care costs for working parents. It favours this approach over uniform increases in child benefit for all parents and ICTU's deputy general secretary Ms Joan Carmichael says it would be far less costly.
Meanwhile, the main public service union, IMPACT, has called on the Government to give the Revenue Commissioners new powers "to track down and punish tax cheats once the November 15th deadline for the voluntary disclosure of bogus non-resident accounts expires". In its submission, IMPACT says the commissioners should be able to set fines and impose interest for tax evasion.
The Society of the Irish Motor Industry has called for the overhaul of vehicle registration tax (VRT) to revive new car sales. In a pre-Budget submission, SIMI has asked that a VRT equalisation proposal for used cars and a reduction in VRT for new cars be considered. Under the proposal, residual VRT on a used car exported from the Republic would be reimbursed to the exporter, making it economical for him to pay registration tax in another country.
SIMI says this would promote a market stifled by double taxation and lead to exported used cars being replaced by new cars at home.
