Government accused on tax breaks for rich

The Government has been accused of continuing to facilitate wealthy people to avoid paying tax by maintaining generous tax relief…

The Government has been accused of continuing to facilitate wealthy people to avoid paying tax by maintaining generous tax relief schemes.

Last December, the Government moved to close off seven tax schemes and introduced new measures aimed at placing a cap on the current reliefs available to high-income earners.

Reacting to the latest report by the Revenue Commissioners, which showed that nearly a quarter of the top 400 income earners in the State paid an effective tax rate of less than 20 per cent in 2002, the Opposition said the measures introduced by Government were insufficient.

Fine Gael finance spokesman Richard Bruton said that while the figures were four years old, they showed an upward trend in the numbers paying little or no tax. "While the Minister has terminated a number of property taxes, the benefits of these will be enjoyed by some for years to come because the relief will be phased out over time," he said.

READ MORE

"This survey also sharply highlights the lack of even-handedness in relation to ordinary PAYE earners, many of whom fail to claim tax reliefs because the system is so complex.

"However, this Government refuses to return ordinary taxpayers' money with the same vigour with which it collects it."

Labour's finance spokeswoman Joan Burton said she was concerned that the number of people with an effective rate of less than 15 per cent jumped by nearly half from 55 to 79 between 2001 and 2002. "Many of Ireland's highest earners continue to have a structure of tax breaks which allows them to pay little or no tax.

"This means that for many high earners, paying tax is an option, not an obligation."

Green Party finance spokesman Dan Boyle said Government policy continued to benefit high earners. "Very little has changed in terms of the tax relief that can be used, the abuse of our tax residency laws and other mechanisms that are available to make Ireland a great country to be ultra-rich in without having the responsibility of contributing fairly to the costs of meeting this country's needs," he said.