Brian Cowen (Laois-Offaly, Fianna Fail)

It would be 1% on the standard rate and 2% on the higher rate and that is before sheltering the money and assuming people did not shelter it. The benefit of the levy is that a person on €200,000 or €150,000 per annum will pay 1% up to €100,100 and 2% for the amount above that. They cannot make deductions in the normal way. That is the reason it is a more progressive tax. It gets the maximum amount from that level of income than would be the case if one opted for the rates route.

The second point is that the 500,000 people Fianna Fáil took out of the tax net are to be subject to a tax burden of 1%, which is one twenty-sixth of the burden the Opposition felt appropriate just ten years ago.

On Deputy Ring's suggestion that one should impose a levy of 2% or 3% on those paying tax at the higher rate, this would not produce the money required.

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