Seán Kyne (Fine Gael)

I welcome the Minister of State. I acknowledge the former Minister, Paschal Donohoe, who has set sail for pastures new and his role in stewarding the finances over nearly a decade as Minister for Finance and Minister for public expenditure. He has left the State in a better way than it was when he came in in terms of balanced budgets, surpluses and money set aside for rainy days. The definition of rainy days is another matter. There are always challenges, issues and things we can spend money on but we also have to prepare for those we do not know, like pandemics. Who had heard of Covid five, seven or ten years ago? There are unknowns.

The Minister of State said "we will stand by our programme for Government commitment to make progressive changes to income tax, if the economy remains strong". That is hugely important. I have said often, if tax thresholds are not increased every year, every second year or where possible, it will mean people on lower wages end up paying higher rates of tax. To stand still, you need to increase the thresholds as wages rise. I know that was not possible on this occasion but it is important that, over the lifetime of the Government, the commitment in the programme for Government is maintained, as the Minister of State said, as long as the economy remains strong. There are challenges and outside threats such as tariffs and other things. It is important we ensure tax thresholds increase and the burden of tax is reduced over time. I welcome the commitments on the USC to ensure those on the national minimum wage do not pay in excess due to the increase in the wage.

On VAT on apartments, from engagement with the people actually building houses, and developers are not nasty people, it is not a nasty word, and by God do we need them, they say this has been positive and will encourage more construction of apartments. We know there are thousands of outstanding apartments with planning permissions which we all want to see built. We want people to get the opportunity to own and rent over the next number of years. Anything that can spur on construction and increase the supply of all types of homes, whether they be private, affordable, social, student accommodation or cost rental, is to be welcomed. I also welcome the changes in relation to student accommodation. More is needed over the lifetime of the Government and the rolling out of the new housing plan.

We have had debates in this House for years about the 9% VAT rate since it was introduced by Fine Gael and the Labour Party back in 2011. It was used to spur the hospitality and tourism sector to encourage job growth. That worked as part of the Action Plan for Jobs. Those were some of the initiatives. Since then, we have had proposals and it has been repeatedly pushed back up and brought back down. We have annual debates in both Houses and I am sure within our own parliamentary party and others. This has now been settled. It is a settled tax policy for the lifetime of this Government and we will not revisit it over the lifetime of this Government. We need to focus on other areas rather than expending a lot of energy and time on that. The hospitality sector is a huge employer of students, young people and those with full-time jobs. They also get up early in the morning, go to work and make a living. We need to protect those jobs. That is what those incentives and that VAT change are about. It is not to benefit any major subset; it is about ensuring jobs are protected in the economy, and I welcome that. I also welcome the VAT retention on gas and electricity bills, which was extended. When you do something, it has to be continued if the benefit is going to continue. People perhaps do not appreciate it is there because it is built in, but unless the Finance Bill reflects Government intention to continue something like that, it would be lost. I welcome those initiatives.

There are a lot of other positives in this Bill which we may refer to on Committee Stage.