Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

Section 8 proposes to extend taxation to maternity, adoptive and health and safety benefits. I wish to raise a key issue for women who are on maternity leave and whose employer does not pay them a salary during their maternity leave. We all know that, in many instances, if a woman's husband or partner in work uses the tax bands and credits then her maternity benefit could be reduced significantly by taxation.

Earlier I examined the interaction of social welfare and tax. Will the Minister clarify the overall direction of policy? It seems inconsistent in a number of respects. Let us examine the schemes that are taxable and not taxable. For example, the carer's allowance is taxable but the disability allowance is not taxable. The blind pension is taxable but certain forms of jobseeker's benefit are not taxable. The Minister is extending taxation into these three payments and I want to understand the policy behind his decision. Are we moving to a position where all social welfare income will be fully taxable? Are we moving in that direction? What is the logic behind subjecting maternity benefit and these two other benefits to income tax when other forms of welfare payments remain untouched? I would like to hear the logic behind the measure as it will have a clear impact on the recipients of maternity benefit. It will have a significant impact on some people.

The Minister has made the point before that some women might continue to be paid their salary. Of course an employer will reduce a woman's salary so that it is the same as her maternity benefit. If maternity benefit is not subjected to tax then she could end up better off. I understand his point but many women are not paid anything other than maternity benefit during their maternity leave. If their benefit is subject to tax then those women will be left in a difficult financial position. I ask the Minister to address my queries and my broader question on why some schemes are subject to tax while others are not.