INDEPENDENT TDS have claimed credit for changes to the Finance Bill that related to the universal social charge, deadline for tax payments, taxation rules for student fees and a levy on bankers’ bonuses.
The final date for filing tax returns by the self-employed was to have been altered from October 31st to September 30th. This has now been abandoned.
The rate of the universal social charge will be limited to 4 per cent for those with a medical card, who will now be treated the same as those over 70 years.
The standard rates for most income-earners are: no charge to €4,004; 2 per cent for €4,004 to €10,036; 4 per cent for €10,036 to €16,016 and 7 per cent for income above €16,016.
Taxation of bankers’ bonuses at a rate of 90 per cent will be added to the Bill as an amendment today at the report stage in the Dáil.
The existing student services charge of €1,500 for third-level students is being replaced with a flat-rate student contribution of €2,000. Although the student services charge did not qualify for tax relief, the student contribution will.
However, the first €2,000 of any claim for relief will be disregarded. Thus, only those that are paying charges for more than one student in a single tax year will benefit from the change.
If a family is liable for the new contribution in respect of two full-time students, they can claim relief on the overall charge of €4,000. The first €2,000 would be disregarded and standard rated tax relief (20 per cent) would be allowed on the balance, leading to potential relief of €400.
This change was previously announced on December 7th following pressure from Independent TD Jackie Healy-Rae.
Independent TD Michael Lowry denied engaging in parish-pump politics in his negotiations with the Government about the Bill, which he supported in the Dáil.
Mr Lowry, who represents Tipperary North, said he held meetings with Taoiseach Brian Cowen and Minister for Finance Brian Lenihan ahead of the vote. He said he was accompanied yesterday by Jackie Healy-Rae.
“The reality dawned on the Government this morning that I wasn’t going to vote for this Bill until such time as changes were made,” he said. “It’s not parish-pump politics.”
Speaking to reporters outside Leinster House ahead of the vote, Mr Lowry said he outlined four issues “that I needed dealt with” in his meetings. “I met with the Taoiseach and I told him I could not support the Finance Bill as it was presently constituted. I think the Taoiseach understood that I meant what I said and he asked the Minister for Finance to meet with me and I was given an hour-and-a-half with the Minister for Finance and his officials.”
Mr Lowry said he had requested changes to the universal social charge measure and a rethink of the decision to bring forward the preliminary tax payment date from the October 31st to September 30th.
He also said it was impossible to justify the omission of the 90 per cent tax on what he called obscene bankers’ bonuses.
Mr Lowry said three issues were resolved to his “total satisfaction”, while the matter of the universal social charge had been dealt with to his “satisfaction on a partial level”. He added: “It was the best that I could do.”
Mr Healy-Rae also said the Government had agreed to his requests: “Because of these assurances . . . I am voting for the Finance Bill. It will probably be my last vote in the Dáil . . . I know this Finance Bill is harsh . . . but I can see no alternative: the whole world is watching to see if we can stabilise our financial situation. Let history be my judge, but I did everything I could for my country and future generations.”
Tipperary South TD Mattie McGrath, who resigned from Fianna Fáil on Tuesday, voted against the Bill and abstained in the subsequent walk through vote. He said he voted against to register “my disquiet”.
He claimed the Opposition would not have offered pairs to Government deputies if they had been serious about defeating the Bill. “I wasn’t going to be bothered walking up the Opposition steps with them. I had registered my vote on the screen electronically and as far as I am concerned I voted against it,” he said.
INDEPENDENTS CONCESSIONS WON
* Deadline for filing tax returns by the self-employed was to have been changed from October 31st to September 30th. But this has been abandoned.
* Universal social charge limited to 4 per cent for those with a medical card.
* Taxation of bankers’ bonuses at a rate of 90 per cent to be added to the Finance Bill as an amendment today.
* Families with two or more children at third level can claim 20 per cent tax relief on €2,000 student contribution paid for more than one child. This was already announced on Budget day last month.