Greens want tax rise on income over £100,000

Taxes for those earning £100,000 or more a year should be increased to 44 per cent and residency rules exempting the super-rich from Irish tax should be dropped, the Green Party has argued.

The proposals form part of the party's pre-Budget submission document, An End to Boom and Bust - Towards a Sustainable Economy, published yesterday.

Employers' PRSI rates should be cut from 12 per cent to 10 per cent to encourage recruitment, though Corporation Tax should fall only to 17.5 per cent and not the Government's 12.5 per cent target.

The Minister for Finance, Mr McCreevy, has "to some extent panicked" in the face of the economic downturn, said Green Party leader, Mr Trevor Sargent.

Last week's Estimates show that the Government is cutting back more heavily on social spending - the "one chance that we have of closing the gap between the rich and the poor". The downturn may make the Government keener on public-private partnerships, he warned, "where those who have will invest and make money from those who do not have".

The health service should be restructured and biased towards promotion, education and primary care.

Tax credits should be used to take the low-paid out of the tax net and paid directly by the Government to such workers in cases where they do not earn enough to use them up fully.

The Green's medium-term aim, said Cllr Dan Boyle, is to have four tax rates of 10 per cent, 25 per cent, 33 per cent and 50 per cent combining PRSI and PAYE payments for those earning above £100,000.

The economy's boom years should have been used better to develop Irish industry, a fairer society and better services. "By each of these yardsticks this Government has failed." Builders should be contracted to use up space, he said.

Borrowing for current spending should not happen: "The practice is one we have extracted ourselves from, and is one we should not be returning to in any hurry." But the current low interest rates offer opportunities for borrowing for some capital projects, he said.