Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I will comment on each of the contributions. Deputy Boyd Barrett knows that I have great respect for the different points he makes and the views he brings to Dáil Éireann but this will be one of my contributions in which the differences between us are more apparent than what we have in common. I continue to be reminded of the near uniqueness of the Irish left. On the one hand, it warns Governments of their over-reliance on corporation tax yet, on the other, it fiercely resists any efforts that are made to widen the tax base to use increased taxes to pay for better public services. Deputy Boyd Barrett is against the local property tax, water charges, carbon taxation and the different forms of taxes that have either been introduced or that we attempted to introduce in order to try to raise revenue to pay for the public services he wants more of. When he responds to me he will likely argue that the wealthy should pay more, but he will not give any credence or recognition to the fact that we have such a progressive income tax system that the more income people have, the more taxes they pay. If he does not make that argument, he will argue that large companies should pay more. If he makes that point, he should also be cognisant of the fact that large companies in Ireland have paid significantly more in terms of the corporation tax receipts in recent years.

I ask Deputy Boyd Barrett to name any credible expert who is arguing that we can respond to the approaching climate change crisis without changing the price of carbon. His commitment to tackling climate change is hollow when he does not acknowledge that if we are not willing to change the price of carbon, we are not going to change the incentives around it. The honesty and commitment the Deputy has in other areas of endeavour are lessened if he is not willing to acknowledge that if we are asking people to use less carbon, there is a case to be made for the price of that carbon going up. That is the argument here. If we want less carbon to be used, a case can be made for changing and increasing the price of carbon as the way of doing that and for the additional revenue from the higher price of carbon to be used for reinvestment in our economy. That is what this Bill seeks to do.

Regarding the arguments made by Deputy Fitzmaurice, I understand the effect of carbon pricing for families that do not have access to the forms of public transport that are available in our large cities. However, this is an argument about taxation. Deputy Fitzmaurice is aware of the income reliefs that are already in place for carbon taxation in the agriculture sector. The double tax relief is available for the agriculture sector to offer mitigation against the effects he mentioned of higher carbon pricing. There is a wide array of tax reliefs and supports available through the tax code to offer support for the families the Deputy spoke about. The Deputy might make the point that it does not affect those who are involved in farming who are not getting enough income to be entitled to the relief. One of the reasons they are not paying tax is that the thresholds on income are set at a particular level. If one is a farmer or a worker in other parts of our economy, we want to set the threshold at a particular level to ensure that if the person's income does not cross that threshold, he or she will keep that income. That is in recognition of the fact that up to a certain level of income the person is not earning enough to be paying higher rates of tax. The reason we have these thresholds in place is to protect low income farmers and workers and to ensure they are only paying tax on higher levels of income. However, I again emphasise that there is an array of reliefs across the tax code because of the value that is placed on the contribution that farming makes to our economy and society.

What Deputy Brendan Ryan described is correct. The VAT is levied on the total bill and part of that bill includes the carbon tax. He is also correct that over time as the bill goes up and if a contributor to the bill is a higher level of carbon pricing, the VAT will be charged on the total amount. What he read to the House is correct. I welcome the fact that the Labour Party supports higher levels of carbon pricing. Its view is that we should have made a larger move in carbon pricing in this budget. It was arguing for a multiple of the move we made, but it is in recognition of the issues raised by Deputy Fitzmaurice that I believe a larger change in carbon pricing in this budget would not have been appropriate.

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