Ictu seeks annual stimulus programme

Thu, Nov 8, 2012, 00:00

Trade unions have called on the Government to introduce an annual €3 billion economic stimulus programme for each of the next three years as well as a series of increased taxes on wealth and unearned income.

In its pre-budget submission, the Irish Congress of Trade Unions urged the Government to reverse its strategy of tackling the financial deficit by means of a two-to-one ratio of spending cuts and tax rises.

Congress recommended that the Government introduce a financial transaction tax, as is being put in place in 10 other EU countries.

It said this could generate €500 million annually for the exchequer.

The Croke Park agreement on public service pay and reform should also be extended beyond its current expiry date of 2014, according to Ictu general secretary David Begg.

The trade unions urged the Government to introduce a new 48 per cent tax rate on incomes over €100,000 and said there should also be a new 1 per cent wealth tax.

The unions also argued that corporations should contribute more by restricting write-offs and that the tax base in this area should be broadened.

Mr Begg said: “We believe we have reached the point where there must be more searching questions about the approach that is to be taken specifically about the taxation of wealth and corporate profits.

“The truth of the matter is that 60 per cent of companies do not pay any corporation tax and the effective tax rate that any of them that do pay is down around 5 per cent.”

Mr Begg suggested that while many of the reliefs provided to corporations were genuine, others were less so.

He said the proposed €3 billion stimulus programme could be funded from a number of sources, including an exemption for pension funds from the recently introduced levy if they invested in infrastructure bonds. He maintained the stimulus programme could create 100,000 jobs.