Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

I had a chance to look at the C&AG's findings on tax and will take a closer look at them over the weekend. I believe everyone should pay his or her fair share of tax in Ireland. As a Government, we have prioritised taking the lowest-paid out of the income tax net altogether. Approximately 30% of people in Ireland, the lowest-paid, no longer have to pay income tax, which is a very good thing. Our focus now is very much on reducing income tax for those on middle incomes, who in many ways often pay the highest tax burden because the very rich can find ways not to pay, whether through legitimate tax incentives or aggressive tax planning and in some cases tax avoidance. It is very often the middle that bears the largest burden of income taxation. This is why it has been our priority to raise the standard rate cut-off point in order that fewer people have to pay that highest rate of income tax and to ensure that people pay less in income tax and universal social charge, USC. While in any one budget this might only be €300 or €400 for a single person and €600 or €800 for a couple, this really starts to add up over three budgets, to €1,800 for a couple. The three-year effect - we have been doing this for three years now - and five-year effect of these taxation changes really make a difference to the take-home pay of those on middle incomes.

It is important, though, to make a distinction between wealth and income. Wealth and income are not the same thing. In our constituencies we all meet people, often elderly people, who own a house that is worth over €1 million or perhaps have life savings but whose income can actually be very small. It may only be €15,000 or €20,000. They might be on a modest pension so they have a low income and do not pay much income tax but they may have quite a lot in assets.

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