Seanad debates
Wednesday, 5 December 2007
Budget Statement 2008: Statements (Resumed)
7:00 pm
Alan Kelly (Labour)
I believed the Senator did not interrupt people. Complimenting his namesake of 20 years ago does not show any degree of modesty.
Senator Boyle went into detail, as he did unscripted on RTE, but he will find that this is not a green budget. It is more of a parsley budget.
I acknowledge and welcome the changes to the budget's procedure. It is a much better way of doing our business to set out the spending of various Departments at this point. We need to acknowledge where spending is going, however, and in some cases that is hard to work out from the figures presented.
The changes to income tax are aimed to keep wages in line with inflation. While they will have some effect, I am concerned some people will not enter the top level of tax, primarily because they do not have the level of income required. This is largely owing to the various types of jobs and the way employers use part-time employment to minimise workers' hours and pay. I am concerned that in the current economic climate these changes will not keep wages in line with inflation.
Non-residency tax loopholes allow millionaires fictionally to live abroad and to get away without paying substantial taxes. In an internal survey it was noted that 48 of the highest earners in the country paid less than 5% tax on their incomes. None of these issues has been addressed by the budget, a matter the Green Party may wish to consider.
The budget did not roll back on several stealth taxes introduced in previous budgets. Raising the duty on cheques is mean as it hits mainly the elderly who may not be as financially sophisticated when it comes to payments with electronic cards.
The mortgage interest relief measures are to be welcomed but have not gone far enough. PRSI, flagged by the Government on previous occasions, has not been dealt with. Why is it still in place, and the health levy for that matter? Many low income workers pay as much in PRSI and health levies as they do in income tax.
I agree with Senator Twomey that while the changes to the stamp duty regime are welcome, they are too late. The current discourse on the housing market will take much to change. I cannot see the new measures doing that. The principal beneficiaries will not be those who buy average-priced houses but those buying at the upper end. The mismanagement of the housing market is written all over this Budget Statement. The increased borrowing and limited tax and social welfare packages reflect the hit the Exchequer has taken from the property slump.
I am concerned that specific loopholes and discrepancies in the tax code have not been addressed. The sale of the Irish Glass site atRingsend exposed a stamp duty loophole which has not been closed.
I am concerned the vehicle registration tax measures are revenue neutral. Some officials in the Department of Finance also have concerns over it. The measures will not do much for hybrid vehicles, considering the numbers of them. Motor tax is simply a tax. It has no link to the environment and will not change behaviour. It is better if that is said straight.
There has been no movement for one-income families or on the PAYE tax credit, thus penalising them on the double. This should be changed and I had hoped the budget would recognise this. It seems, however, that individualisation will remain a policy of this Government.
I lament the PAYE tax credit not being amalgamated with the individual credit for those who are self-employed. Many, self-employed workers, especially in the construction industry, cannot avail of it. It is touch and go to call them self-employed because in many cases they work under contract for someone else.
I do not believe some of the social welfare increases will keep up with inflation. I welcome the increase in the incapacitated child benefit. However, there has been no move on fuel allowance.
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