Sir, – Minister for Finance Michael McGrath says that Sinn Féin’s tax policies will damage the economy by making the State less attractive for business leaders (“Sinn Féin’s tax policies would damage the economy and jeopardise jobs, McGrath claims”, Business, January 18th). How right he is.
The Department of Finance has said that the high concentration of income tax paid by relatively few higher earning employees is a major risk to the Irish tax base. It is clear that the international mobility at the higher earning segment of the labour market presents a very significant risk that the highest-quality jobs are at risk of moving. Feedback to major employer, investor and economic groups suggests a brewing problem, which will be badly compounded given a potential outcome to the next general election.
The taxation plans not just of Sinn Féin, but also Labour, the Social Democrats and People Before Profit, all of whom want more tax levied on those who already pay most, will have a real impact on Ireland’s economy. Sinn Féin plans to remove tax credits on incomes above €100,000 and introduce a new 3 per cent tax on incomes above €140,000, on top of all the existing high income taxes. The party will also increase employers’ PRSI for higher earners and reduce the standard fund threshold for private pensions – hitting employers and those who cater for their own private pension. Sinn Féin also plans to increase the rate of capital acquisitions tax to 36 per cent, levying more tax on children of deceased parents. Perhaps most damaging of all, the party says it is in favour of a new annual wealth tax – a tax that is likely to drive investment and wealth out of our highly open Irish economy. Too few people – many of whom are business leaders – already pay too much personal tax in this country.
The Department of Finance has confirmed that the most significant risk in our taxation system is the overdependence on a small base of higher-paid employees and multinational companies. Sinn Féin intends to ignore this reality. – Yours, etc,
MARK MOHAN,
Dublin 15.