Lower taxes support work and strengthen the recovery – Harris

The Minister of State at the Department of Finance and Fine Gael TD for Wicklow, Simon Harris, said today (Monday) that lowering the tax burden on ordinary workers and families will strengthen the economic recovery that is taking hold.

“Lower taxes support jobs and high taxes kill jobs. The Department of Finance estimates that a programme of reducing tax on incomes introduced in 2015 for 2016, 2017 and 2018 would increase employment by approximately 1 per cent or the equivalent of 20,000 jobs by 2020. The same research shows that increases in taxes on work would do the reverse.

“Let’s be clear. Reducing the tax burden on working people and families does not reduce the tax base. They are very different things. Last year the Government reduced income tax and USC rates for low and middle income earners. But overall the tax take actually increased. Income tax was up by €517 million at the end of July 2015, compared to July 2014. The overall USC take is also up, and VAT receipts are up €560 million year on year demonstrating that reducing taxes on work boosts balanced domestic spending.

“Framing an economic debate as a choice between reducing taxes and investing in services is both simplistic and lazy. Strong growth in jobs is funding tax cuts on working people. And less tax on work in turn means more jobs, over 125,000 since the launch of the Action Plan for Jobs in February 2012. About 1,300 jobs per week are being added to the economy.

“The reduced 9% VAT rate the tourism industry has added 30,000 jobs according to Fáilte Ireland. Similarly the very popular Home Renovation Scheme is contributing to employment growth around the country.

“The goal of our economic plan is to reinforce a virtuous circle of rising living standards, lower taxes on work, job creation and improving public finances.

“The principal risk to Ireland’s continued economic growth is the tax and spends policies of the opposition.

“We’re never going back to Fianna Fáil’s boom and bust model. Over 80% of FF’s tax increases were taxes on jobs.

“People are right to expect their efforts will be rewarded as we make progress. Fine Gael is committed to continuing to reduce the tax burden on ordinary workers. We are the party that rewards work and incentivised employment. This will allow us to realise our priority of replacing all the jobs lost during the crash by 2018.”