Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

This was shameful and completely unnecessary. The points we and others raised at the time are every bit as valid today as they were in December and earlier in the year. When we discussed the local property tax in December, I took issue with the contention of the Minister for Finance that the tax was fair and progressive and that the wealthiest would pay the most. It is clear this is not the case as liability for the tax takes no account of ability to pay, with the exception of single people on less than €15,000 and couples on less than €25,000 per year.

I listened to the comments of the Minister hailing the low rate of people who opted for deferral as evidence that people have the money to pay. The people who came in to me were mainly elderly people who qualify for a deferral but they felt so guilty about deferring it and passing it onto the next generation that they felt an onus to pay the tax. I helped many of them to complete their returns, on paper and online.

Houses do not represent a store of wealth for Irish families. In the case of many families, their property is their home and they have no intention of selling. We have to reserve judgment on the latest announcements on the mortgage arrears targets brought forward by the Government and the Central Bank as it is too soon to see the impact of the targets, which begin to kick in at the end of June. The formula put forward in March by the Minister for Finance effectively leaves the banks in the driving seat. The banks got what they wanted without giving anything meaningful in return. The Government pushed through its Land and Conveyancing Law Reform Bill to make home repossession easier before the banks had been required to demonstrate the willingness and capacity to deal with the mortgage arrears crisis in a tangible way.

The domestic economy is, at best, stuck in neutral. Services exports are doing well, goods exports are contracting in view of the ongoing difficulties in the eurozone and the wider global economy, consumer confidence remains fragile and the 426,900 people on the live register will take no comfort in the Government’s claim that it has achieved 95% of the targets under the Action Plan on Jobs.

I hold to the view the local property tax was not the correct measure to be introduced in 2013. In our budget proposals last December, we set our alternatives to the introduction of the local property tax. Recently, one of the large supermarket chains cited the introduction of the property tax as a key reason consumers are not spending in the shops. When the tax was introduced, I predicted it would have a disproportionately negative impact on the economy and those most vulnerable in society. I believe this has been borne out.

Other measures could have been taken in 2013, including consumption tax measures, restriction of pension tax relief and examining the universal social charge on incomes in excess of €100,000. However the Government chose not to take these ideas on board.

While the public finance targets remain broadly on target, and we welcome this, receipts under some key tax headings are under pressure and must be monitored. The effect of the Sinn Féin Bill, if implemented immediately, is that Ireland would require a mini budget immediately or in July, to be followed by the 2014 budget in mid-October. The Bill requires the €120 million paid by householders to the Revenue Commissioners to be repaid as quickly as possible. It also involves not deducting payments from those who have signed up for the single debit authorisation due on 21 July and the cancellation of debit direct authorisations. That is what the Bill proposes if the House enacts it.

I am not aware of any occasion in the history of the State where, halfway through the year, the State has made an across-the-board tax refund in respect of a particular tax that had been levied lawfully by the Oireachtas. That is not a credible position and it is not a politics I subscribe to, no matter how popular. The correct time to review all taxes, including the local property tax, is on a calendar year basis. The abolition of taxes, the reform of taxes and the introduction of new taxes should be done in the annual budget except in emergency situations. We can all agree that we have had too many emergency fiscal measures, introduced by my party, over the past number of years.

Fianna Fáil will vote tomorrow night to allow the Bill go to Committee Stage in order to shape the type of amendments that should have been discussed at more length.

I dispute the Minister's assertion that we had something akin to a proper debate in this House in December or in the new year. We did not. The Minister sat through those proceedings and knows we only reached section 1. At the time the Minister blamed the Opposition for engaging in Second Stage speeches on Committee Stage, but the reality is that amendments of real substance were tabled but they were not even debated.

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