Seán Sherlock (Cork East, Labour)

I will share time equally with the Deputy.

If I understood the Minister correctly, bank bonuses will be taxed at a rate of 90%. I have not been informed as to the number of employees who will benefit from bonuses. If, however, 90 employees of the banks which come under the guarantee were to benefit from a bonus of €40 million, each of them would receive €444,444. If a tax rate of 90% was applied to this figure, they would each receive a net payment of approximately €44,400. Any type of spin which seeks to dissipate the effect of paying these bonuses will not work because the beneficiaries will still receive significant sums of taxpayers' money. An underhand approach has been taken and the legislation needs to be revisited in this regard.

It is immoral that bonuses should be paid to fat cats when those on the minimum wage are countenancing a cut in their income. Some 6,000 signatures of people opposing the cut were gathered in the past 24 hours by the Migrants Centre of Ireland whose members campaigned outside the gates of the House today. The payment of bonuses to bankers is an affront when juxtaposed against cuts in the incomes of people who are barely surviving on the minimum wage. It is an insult and certainly not how the country should do its business.

The introduction of the new universal social charge will bring those on the minimum wage into the tax net. The Minister misled the House last night when he stated those on the minimum wage would not be subject to taxation. The universal social charge is a tax, as explicitly stated in Financial Resolution No. 13. The Minister stated: "In the measures I am presenting today, those on the new reduced minimum wage will not be brought into the tax net." Is he suggesting that those on the minimum wage will not be subjected to the universal social charge? It is as clear as the nose on my face that if one earns more than €4,004, one will be subject to the charge at a rate of 2% up to €10,000. There is a question mark over whether one can claim back the charge for the first €4,004. This matter should be clarified. The bottom line, however, is that the Government is not only reducing the minimum wage but removing the exemptions enjoyed by those on the minimum wage and subjecting them to a new tax.

This measure is woefully inadequate and inequitable. If one subscribes to the notion that everyone must share the pain proportionately, one must accept that the proposal requires people on the minimum wage to pay a disproportionate amount. The measure must be opposed. I am proud to oppose any proposal that seeks to reduce the pay of those who are on marginal incomes.

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