Fine Gael and Labour have differed on income-tax policy.

Labour will not be following the traditional route and supporting a Fine Gael private member's motion on the issue when it is voted on in the Dail tonight. Instead, it has moved its own amendment to the motion. A Government amendment to the Fine Gael motion, endorsing its policy, is expected to be carried with the support of Independents.

The Fine Gael motion reads: "That Dail Eireann, aware of the increasing labour shortages in the economy, conscious of the deteriorating industrial relations situation in the public sector, supportive of the re-negotiation of another partnership agreement, acknowledging that many persons have not benefited from the booming economy, calls on the Government to announce its commitment to introduce an income-tax reform programme which would include the following measures:

The removal of the first £170 of weekly income from income tax.

The extension of the standard-rate band of £17,500 in respect of single persons and £35,000 for married persons.

The introduction of a new middle rate of income tax at 35 per cent which would apply to income from £17,500 to £50,000 for single persons and £35,000 to £100,000 for married persons.

The maintenance of the 46 per cent rate for the top 5 per cent of income taxpayers.

The completion of the transfer to tax credits from tax allowances.

The commencement of the integration of the income tax and social welfare systems.

"Dail Eireann, aware that families with young children need particular care, calls on the Government to increase child benefit to £25 per week per child, for all children under five years of age, and to take steps, as a matter of urgency, which will increase the supply of well-managed, well-regulated, affordable childcare facilities."

The Labour amendment reads: "Aware of the fact that people enter the tax net at too low an income and graduate to the marginal rate too early, and also aware of the existence of poverty and employment traps for low-income earners, Labour calls on the Government to announce its commitment in advance of negotiations on a new national agreement to an increase in the proposed national minimum wage to £5 an hour and to the removal of this level of income from the tax net altogether, and the extension of the standard rate band to £20,000 for single people and £40,000 for married couples.

"But also, mindful of the serious inadequacies in many public services, including growing waiting lists in the acute hospital sector, an unprecedented housing crisis, the failure of the Government to meet its targets for overseas development aid, the continuing existence of class sizes in our primary schools in excess of 30, the inadequate funding of public transport, lengthening queues for appointments with legal aid solicitors, Labour calls on the Government to abandon its commitment to a 4 per cent ceiling in public spending increases in favour of a figure commensurate with either the rate of GNP growth or the projected increase in taxation income, whichever is higher."