Shane Ross (Dublin South, Independent) | Oireachtas source

It would be very churlish of those of us on the Opposition benches not to recognise that some elements of the budget should be approved and applauded or not to admit that we recognise the difficult situation in which the Government has found itself in the past three or four years or that it is working within certain constraints. While we disagree with regard to some of those constraints, the Government has decided to work within them. Although I do not accept those constraints, I will talk within them, because some of the ships we have championed in the past have already sailed.

I welcome the retention of the 9% VAT rate in the tourism and hospitality sector. I welcome this not because the lobby groups, which are right and which have been extraordinarily successful, have succeeded, but because there is an implicit recognition in this retention that reducing tax and VAT has brought tangible benefits. What has happened in this case is that the Government has recognised that its reduction of VAT from 13.5% to 9% in an effort to create jobs and create a buzz in the hospitality, hotel and restaurant sectors has been one of its most successful financial moves during its term of office. I applaud the Government on this wonderful achievement and I see its recognition that it should not raise the VAT rate again as another great achievement.

I regret, however, that the Government does not recognise that this achievement means something more fundamental. It means that there is great merit in cutting tax and VAT for small businesses because this creates jobs. I regret also that having recognised that in what it has done, the Government did not extend this principle to other businesses in the small and medium enterprise sector. It should say it will cut taxes in this area and others and will reduce VAT for other industries. Other small business areas are crying out for help and want to employ more people, but they do not receive the sort of support that has been given to the hospitality sector. The retail industry is on its back and would welcome such support and create more jobs if it got it. The printing, transport, fishing, small manufacturing and other industries could be assisted in this way. The dividend from tax cutting, while not a panacea for all ills, has been recognised by the Government in this budget. I applaud it on that, but I deeply regret that this was not included among the approximately 25 measures in the package for entrepreneurs, because the spin-off and the benefits have already been proven and recognised by both the Government and the Opposition.

It is self-evident also that the low 12.5% corporate tax rate creates huge employment in this country and has brought significant spin-off benefits in taking people off the live register. I urge the Government not just to concede to lobby groups when this happens and not just to make this a once-off, but to look in future at the benefits of tax cutting in key industries where employment can be created, which it has so successfully done here.

I regret also the fact that the money to fund this and an extension of it appears to have come once again from the pension levy. When the levy was announced a year and a half or two years ago, I asked the Taoiseach why not take the 0.6% from the industry, not from the members of pension schemes. The figure of 0.6% was set in stone for four years. We were promised that it was a once-off and that we would be out of the woods in four years. Now, well disguised in the Minister's speech in incomprehensible language which had to be translated and interpreted by others, a 0.15% levy will be added to the figure of 0.6%. Not only is there this extra amount which is a breach of the Government's promise - this is not a new experience for many in the House - but next year we also will have a 0.15% levy and the year after that ad infinitum.

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