Union says abolition of USC would be bonus for highest earners
December 15th: Unite today expressed concern at what it termed a ‘tax cutting auction’ being conducted in the media as political parties position themselves ahead of a General Election. Regional Secretary Jimmy Kelly warned that low income earners in particular would see little or no improvement in their living standards from either a cut in the top rate of tax or abolition of the Universal Social Charge, but would be disproportionately hit by further cuts in public services and income supports to fund such tax cuts.
“As we slowly emerge from recession, the focus must be on improving living standards for working people, rather than on populist tax cuts which will further undermine the public services and income supports on which people depend – services which have already been hollowed out during long years of austerity.
“As pointed out by Unite at the time, and reinforced last week by the ESRI, the tax cuts already introduced in Budget 2015 did not improve living standards for the vast majority of people. On the contrary – 60 per cent of people will find themselves worse off after Budget 2015, despite the Government spending over half a billion Euro in tax cuts.
“Working people need investment in health, affordable childcare, housing, transport and all the other services on which we depend. Working people need wage increases – they need an increase in the Minimum Wage, and they need progress towards a Living Wage. And working people need the abolition of water charges which, following the Government’s panicked response to the Right2Water campaign, is now a regressive flat-rate home tax. What working people do not need is tax cuts which will disproportionally benefit those at the very top of the income pyramid”, Jimmy Kelly said.
Unite researcher Michael Taft added:
“The recent ESRI analysis showed that, despite tax cuts of nearly €650 million in Budget 2015, most households experienced a fall in income and living standards. This points to a real two-fold problem. First, Irish incomes from work and social protection are well behind our comparable EU neighbours. Secondly, tax cuts can’t address the real problems in living standards such as the high cost of childcare, housing, healthcare, education and public transport. We need social and economic investment to reduce living costs and, so, boost living standards. But tax cuts will make it harder to address these. In short, a tax-cutting agenda is a tax on living standards”, Michael Taft concluded.