Professor Alan Barrett:

On the question of whether the tax base is broad and stable enough, it is very hard to answer that in an absolute sense. That said, given where we are in terms of the international uncertainties to which the Deputy referred, our perspective would be that it does not make sense to do anything at this point that would weaken the tax base. Hence, the remarks on the USC in particular. To add to that, if one takes the recent experience of trying to introduce water charges and before that, the local property tax, LPT, the lesson to be learned is that there is a difficulty with introducing new taxation measures. Therefore, if one has measures already in place that people have become used to, while not necessarily liking them, why would one unwind them if one was facing the prospect in a few year's time of having to try to reimplement certain measures? With the greatest respect to everyone in the room, we all agree that these things are tremendously difficult. I was struck by the thought that perhaps in a year's time a variety of people in this room could be coalition partners trying to negotiate budgetary packages in the wake of some international crisis and it would be terribly unfortunate if the tax base had been hollowed out in the interim.

On the issue of regional development and what can be done in budget 2017 in this area, I would urge the committee to think about this in a much more long-term way. We have touched on this already in terms of capital investment and the need to think about it in an integrated way. Dr. McQuinn mentioned the fact that the Department of housing, planning, community and local government is working on a national planning framework that will replace the national spatial strategy. We must think about these things in a longer-term context. The harsh reality of modern economic development is that it is focused in larger urban areas. Very often regional development is a fight against natural economic processes and has to be seen in that way. Doing anything about that and trying to reorganise the pattern of economic development will require some of the investment we have spoken about but we need medium-term strategies to make sure it will happen.