Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I move amendment No. 15:

In page 20, between lines 24 and 25, to insert the following: “Report on re-introduction of Trade Union Tax Relief

17. The Minister shall, within 6 months of the passing of this Act, prepare and lay before Dáil Éireann a report on the reintroduction of the Trade Union Tax Relief.”.

This tax relief probably comes down to the way someone views trade union membership. In my view it is healthy and is healthy to promote it. A key goal of workers and unions is to achieve wage growth that outstrips the increasing cost of living. We can see that one of the ways to do so is to increase the bargaining power of workers through their unions, them to negotiate larger slices of the pie on behalf of workers while also encouraging and enhancing productivity. We can see from many of the analyses that have been done at international level that this can go hand in hand. Where there is a well organised workforce, there are heightened levels of productivity that benefits not only the workers but the employers.

This State has moved away from that trend for different reasons and I do not suggest that the tax credit is the only reason. The labour force survey showed in 1994 that nearly half of all employees were members of a union but by last year, the figure had fallen to 25%. What has happened in the private sector is more concerning. Union density was 20% in 2010 but six years later, the figure had halved.

A review was completed following a commitment made in budget 2016 to examine the appropriate treatment for tax purposes of trade union subscriptions. The scheme that operated in the past, which provided an income tax relief of €300 in respect of trade union subscriptions, should be reintroduced. At the time a small amount was available to workers but, in 2010, when it ended, 337,000 workers were availing of the tax credit, which was the equivalent of €70 per annum for union membership. Now we have rehashed this matter on Committee Stage of the Finance Bill in previous years, regarding the differences between the treatment of members of trade unions and members of other organisations who can write off their dues or fees against their tax bill.

The trade union tax relief or credit was abolished in 2011 at a time of deep austerity when many reliefs and credits were abolished. Given that the State has the third highest rate of low-income workers in the OECD, and the fact that we have had other debates about how taxpayers subsidise the SARP scheme and so on, the reintroduction of the trade union tax relief should be considered under the legislation. That is why my amendment seeks a report on the matter to be laid before the House within six months.