Seanad debates

Wednesday, 26 March 2003

Finance Bill 2003 [ Certified Money Bill ] : Committee and Remaining Stages.

 

The Government and the country received great praise from the OECD yesterday for the policy of keeping tax low. It was said that the policy should act as an example to governments in other jurisdictions. It will be quite a battle to maintain the current tax rates of 20% and 42%. When there is pressure on the public finances, as there is this year, it is inevitable that one has to resort to under-indexation, a certain widening of the tax base and other measures. I agree with the fundamental point being made by the OECD, which is that our policy is good for confidence and competition. The Minister has my support in what he has been doing to maintain the rates as they stand. Even if we did not have the particular problems we have this year, tying a Minister to indexation would be undesirable. The Italian economy, which used to be in bad shape, had a principle of indexation known as the "scala mobile", which sounds like the name of a Rossini opera. We do not want to go down that road.

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