Joan Burton (Dublin West, Labour) | Oireachtas source

I want to raise several issues, some of which have been referenced before. Just before this meeting began, during Question Time in the House, the Taoiseach was extremely bullish about the desirability of tax cuts, particularly for middle and upper-income people and about moving the point at which people enter the higher rate of tax. We had tax cuts last year. I want to ask the representatives of both organisations whether they think we have room for tax cuts. In the context of the recent advice from the Irish Fiscal Advisory Council, will our guests outline their thoughts on that at this point? The Taoiseach really was quite emphatic about the desirability of tax cuts so I would like to get their views.

On a related point, I was glad to see the Social Justice Ireland reference to a minimum effective tax rate, something for which I have long advocated.

A Labour Private Members' Bill has been before the Dáil for nearly two years that would establish what effectively would be a standing commission on taxation to examine in a coherent way on a year-by-year basis at the issues of tax expenditure. This committee has done much work but this commission would look at the area in a broader way, considering who would gain or lose out from certain kinds of tax structures.

With regard to financial institutions in Ireland, there can be no argument against a minimum effective tax rate of half the corporation tax rate, for example. That would be approximately 6% and one could move to that over a period of two years. Without a doubt, our European Union partners are changing their approach and we are going to have to change. They may pick a rate of 12.5% or 15% and we will have no autonomy in the matter unless we begin to make policy that indicates our own position. There was also a reference to the trade-off on the bank levy. When we were in government, the bank levy was our proposal to mitigate the impact of the zero-tax companies. Where is that now in the context of the international organisations with which the witnesses have contact? What kind of progress has been made on it?

We are all interested in pay rates and the Government is clearly softening up public opinion to lift the cap on top bankers' pay, which runs around €500,000, with additional elements relating to pensions. On a comparative basis, is now the appropriate time to lift that levy on bank pay? There is a great deal of lobbying in financial services to have it.