Dáil Éireann debate -
Tuesday, 23 Apr 1968

Vol. 234 No. 1

Financial Resolutions. - Financial Resolution No. 1: Income Tax and Sur-Tax.

Minister for Finance (Mr. Haughey)

I move:

(1) That income tax shall be charged for the year beginning on the 6th day of April, 1968, at the rate of seven shillings in the pound.

(2) That sur-tax for the year beginning on the 6th day of April, 1968, shall be charged in respect of the income of any individual the total of which from all sources exceeds two thousand five hundred pounds and shall be so charged at the following rates, that is to say:

In respect of the first two thousand five hundred pounds of the income	Nil
In respect of the excess over two thousand five hundred pounds,
for every pound of the first two thousand pounds of the excess	Three Shillings
for every pound of the next two thousand pounds of the excess	Six Shillings
for every pound of the remainder of the excess	Nine Shillings

(3) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).

Mr. M.J. O'Higgins

Does this Resolution deal with the present rate of tax?

Mr. Haughey

It brings about the sur-tax change to which I referred, as well. This applies to something Deputy Corish raised in the course of his speech. Really, all we are doing in this sur-tax change is taking the emphasis off earned income and putting it on to unearned income. In so far as the relief given to the earned income in the sur-tax bracket is not recovered from the unearned income, it is recovered more than amply by the tax on wine and brandy.

Mr. James Tully

It is caught in the general taxation. Might I inquire if it is not usual to give us the details? Surely every Deputy is entitled to that?

Mr. Sweetman

They were not circulated this time.

Mr. Haughey

I thought everybody got a copy.

Mr. T.F. O'Higgins

I do not understand Resolution No. 1 and Resolution No. 2.

Mr. Haughey

Resolution No. 2 is an ordinary one.

Mr. Sweetman

No. Surely Resolution No. 2 refers to the reliefs?

Mr. Haughey

Wear and tear. No. 2 is cautionary, as it were. I mentioned in the Budget speech that we propose to rationalise the rates of wear and tear. At the present time there is a great range of wear and tear rates. What we propose to do is to rationalise them and reduce their number. This may result, conceivably, in somebody paying a little bit more tax.

Mr. Sweetman

Then there is no resolution that covers the £100 marriage allowance?

Mr. Haughey

It does not require a resolution; that is a relief. I wonder if I made the position about sur-tax clear to Deputy Corish. As I say, it is a relief that we want to give to technological and managerial people. We are giving relief on earned income and, in the main, we are recovering that relief from unearned income for sur-tax purposes.

Mr. Corish

But you have given them £120,000.

Mr. Haughey

I am specifically getting that back from brandy and wine.

Mr. Corish

I am voting against it.

Mr. Cosgrave

How does this compare with the relief given to similar categories in last year's Budget? Is this in addition?

Mr. Haughey

Yes, it is in addition.

Mr. M.P. Murphy

Would the Minister state what is the level of the new taxation now proposed in this Budget? The tax bears mainly on tobacco, beer, spirits, wine. I think the general public should know the present level of taxation. Could the Minister tell us what is the tax on plug tobacco or pressed tobacco, and what is the tax on loose tobacco?

An Leas-Cheann Comhairle

Financial Resolution No. 1 deals with income tax and sux-tax.

Mr. M.P. Murphy

Then we shall have to deal with the other Resolutions as we come to them.

Mr. Sweetman

There is no relief in this Financial Resolution.

Mr. Haughey

You do not need a resolution for relief.

Mr. Sweetman

I know. This is purely a charging Resolution, increasing——

Mr. Haughey

And the Labour Party are going to vote against it. That is why I am trying to save them from themselves.

Mr. James Tully

The Minister has been studying this for weeks. Because of some peculiar arrangement in the House, only Ministers and ex-Ministers get a copy of the Budget speech. Even those who are responsible in their Parties for finance do not get a copy. We have just heard of this a second ago and the Minister says in a cattish way that we do not understand it. We do not even know what is going on.

Mr. Haughey

I did not mean it in any derogatory fashion. I only meant to point out, and I was trying to point out to Deputy Corish, that this in fact increases sur-tax on unearned income——

Mr. James Tully

We see it now.

Mr. Haughey

——and if you wish to vote against my idea you can do so specifically when the Finance Bill comes up.

Question put and agreed to.