Opposition parties and business groups have given mixed reaction to measures announced in the Finance Bill today, including the new income levy and changes in tax credits for research and development.
Fine Gael finance spokesman Richard Bruton said Ireland was one of the few countries in the world resonding to the economic crisis by "increasing taxes".
He claimed the Finance Bill included a total of 17 taxes that would cost the average family up to €2,450 in 2009 and further dent consumer confidence in the economy.
“The Bill is the final piece of a deeply-flawed Budget jigsaw which failed to chart a way out of the current economic mess,” he said.
The Labour Party said the income levy confirmed in the Bill would result in a big reduction in take-home pay for people on modest incomes.
Labour Party finance spokeswoman Joan Burton said anyone under 65 earning "even €1 above the exemption threshold of €18, 304" would pay the levy on the whole of their gross income.
"The failure of the Minister to introduce any marginal relief will hit lower paid people particularly hard.”
Ms Burton said that by introducing a levy, the Minister was seeking to deny he was increasing income tax.
“The expected €1bn yield from the levy, which applies to gross income, would be equivalent to a 3 per cent increase in the 41 per cent tax rate (as per the Department of Finance’s ready reckoner).”
Sinn Féin economy spokesman Arthur Morgan welcomed the 3 per cent income levy on higher earners but said his party would table amendments to the Bill to address the public finance crisis and help working families.
"The measures in the Finance Bill will put more pressure on low to middle income working families who face VAT increases in the run up Christmas and the income levy from January 1st," he said.
The Irish Banking Federation (IBF) welcomed the inclusion in the Bill of what it said were important measures to enhance the Research and Development (R&D) tax credit scheme for business.
But business representative body Ibec said the Bill was a "missed opportunity to provide meaningful support to the traded sectors of the economy in the current challenging environment".
Ibec said the Bill "failed to address the fact that Ireland's standing as a location of choice for world class R&D is under threat from other EU countries, which provide more competitive full volume based R&D supports".