Beverley Flynn (Mayo, Fianna Fail)

Like my colleague, I welcome the opportunity to speak on the Finance Bill 2010. My colleague set out the context in which this Bill has come about, namely, to give legal effect to the December budget which brought about cuts of more than €4 billion. It was probably the toughest budget this House has ever seen. This was set against the background of the number of unemployed being in excess of 430,000. This is a very regrettable situation, in particular in my home town of Castlebar where today the Halifax Building Society informed people they will lose their jobs by the end of July. The National Irish Bank branch further down the street will close at the end of the year. This is an unfortunate consequence of the terrible banking situation in which we find ourselves.

Many people are in trouble with their mortgages. We all know of the problems people face in regard to business. It is now time for us to rebuild and focus our attention on maintaining and creating jobs. I disagree with my colleague opposite who said this Bill does nothing in regard to creating and maintaining jobs. Several measures have been introduced between the budget and the Finance Bill which go a long way towards doing just that.

As announced at the time of the budget, €130 million in funding was provided to create 26,000 training places. Some €165 million was provided, through the stabilisation fund, for the temporary employment subsidy scheme in 2010. The second phase of that job subsidy scheme will be implemented in the coming weeks and we hope it will provide many small, medium and large businesses with valuable supports at this point. In my constituency, many companies have applied for that assistance and it will make a huge difference when it becomes available.

We are maintaining our low tax base which has been a huge factor in, and benefit to, our economy with a corporation tax rate of 12.5%. I welcome the extension of the scheme of tax exemption on income and gains of new start-up companies for the first three years. This will be now available to companies which commence trade in 2010. That is a very welcome development. I also welcome the reduction of 0.5% in VAT. It is a small but important confidence building measure which has been greatly welcomed by the retail sector. We hope it will have some impact in terms of retaining jobs in that sector.

One cannot discuss the Finance Bill 2010 or the budget without referring to the public sector pay cuts which have been tough, in particular on the lower paid. That must be acknowledged. It has been tough on everybody in society but in particular on lower paid people and that is why I am pleased that, under section 22, the high earners will have to pay more. That was spelled out in the budget and it is being given legal effect in this Bill. People availing of the tax incentive schemes will have to contribute more in these difficult circumstances. In 2010, the effective rate of income tax for those benefiting from these reliefs will be increased from 20% to 30% on top of which they will also pay PRSI and levies.

While I am on the subject of allowances and incentive schemes, it is important we recognise that while many of these allowances are being abolished, they have a place, in particular when they provide for very important infrastructure in our economy. Today, as a member of the Joint Oireachtas Committee on Health and Children, I attended the launch of the primary care report which hopes to see in excess of 500 primary care teams set up in the coming years. There is a very important role for the private sector in building these primary care centres. It is an important investment in the health infrastructure of our economy and it is of real benefit to the ordinary people. At a time when there is no capital available from Government to build these centres, this needs to be seriously considered. The Minister for Health and Children, when she addressed the committee today, referred to that fact and said she would support it. I would like the Minister to consider that in the near future, if possible.

I welcome the domicile levy in section 141 which has been spoken about in this House in the past. All Irish nationals with a worldwide income in excess of €1 million and whose Irish-located capital is greater than €5 million will be required to pay an Irish domicile levy of €200,000 per annum, regardless of where they are tax resident. These measures show we are serious about tackling the high earners. It is important that they are seen to pay more, in particular when we are taking money from the lower paid through public sector pay reductions. It is important those measures work and are effective.

The farming community has been going through a very difficult time in recent years. There is no money to be made across many sectors, whether milk, beef or sheep. In my constituency, a large number of farmers are in REPS - in fact, the highest number in the country - and many of them are on, or below, the average income for farming. It has been very tough and, therefore, I welcome the income levy exemption for expenditure incurred by farmers under the farm waste management in section 2. This is an important measure. The Government invested more than €1.1 billion in the farm waste management scheme. The scheme was set up to improve our environment and I welcome that income levy exemption, which is an important measure.

One can discuss the merits and demerits of the carbon tax, but I would like to bring to the Minister's attention how it impacts on the farming community. From 10 December 2009, the carbon tax applied to fuel, oil, natural gas and peat briquettes. However, it will apply to other fuels, including farm diesel, from 1 May 2010. The farming community is extremely concerned about this and I have received many representations from it in my area. It estimates that it will increase farm production costs by €13.2 million in one year. Will the Minister consider this at a time when the farming community is already struggling in terms of its income? While I welcome the fact that the Minister made provision in the budget for those not availing of REPS 4, in that they can now get up to €5,000 under the new agri-environment scheme, I ask him to reconsider the date for commencement in regard to farm diesel because of the impact it will have on the farming community.

I refer to the windfall tax of 80%, with which I disagree. Any tax of 80% is crazy. By the time one adds any additional costs involved for the disposal of land, the overall tax take increases to approximately 90%. It is inequitable, unreasonable and unworkable and I hope it will be removed in the foreseeable future. It should not be included in the Bill.

On job protection, I welcome the fact that the Bill contains a number of measures to restore confidence in some industries which have been dying on their feet. I refer in particular to the car industry. It is worth bearing in mind that in my constituency there were as many people working in the car industry as were working in the construction industry. Sadly, thousands of those jobs have gone in recent times. The introduction in section 102 of the car scrappage scheme which, in effect, reduces the price of a new car by €1,500 when a ten year old car is traded in and scrapped is a welcome measure. It is something for which we have asked for the past number of years and it is long overdue. It has come too late, unfortunately, for many companies but I welcome its introduction.

I also welcome the changes regarding the extension to mortgage interest relief in section 6, which gives some help to people who have been struggling with their mortgages. As Deputy Feighan mentioned, it is not popular or cool to discuss the construction industry and how we might support it at the current time. One can discuss property developers ahead of any company, but we often forget that beneath that there are many thousands of people, such as blocklayers, plasterers, plumbers or electricians who are out of work and are currently in a very difficult position. We have to do something to kick-start our construction industry, whether through the introduction of allowances for, as I mentioned earlier, the creation of new primary care centres around the country or the building of schools. It is important that at a time when costs are lower than they have been for some time that we introduce such measures.

The solidarity bond is something about which I wrote to the Minister for Finance approximately 14 months ago. I welcome its introduction in Finance Bill 2010 in order that ordinary people can now contribute to the funding of our economy.

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