Tax breaks 'could cost State €7.4bn'

Tax breaks could cost the Government €7.4 billion in 2009, a think tank has claimed, writes Suzanne Lynch.

Tax breaks could cost the Government €7.4 billion in 2009, a think tank has claimed, writes Suzanne Lynch.

In its pre-budget statement, Tasc has called for an overhaul of the tax-break system, claiming it could significantly contribute to the €4 billion in cuts being sought by the Government in the budget.

According to Tasc, the Irish tax system provides more tax breaks than other EU members. Its research suggests that in 2005, Ireland spent three times as much through tax breaks on personal income tax as the average of 22 EU countries and seven times as much through tax breaks on corporation tax.

Tasc contends that, while the figure will be less in 2009, Ireland still has far more tax breaks than other EU countries.

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Among the recommendations set out by the think tank is that a “sunset clause” should be attached to all tax breaks, which would see them expire after one year unless they satisfied an equality and economic efficiency audit presented to the Oireachtas.