Vol. 287 No. 4
I move:
(1) That, with effect as on and from the 6th day of April, 1976, subsections (1), (2) and (3) of section 1 of the Finance (No. 2) Act, 1975 (No. 19 of 1975), be amended by the substitution of "1976-77" for "1975-76" in each place where it occurs.
(2) 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).
Could I ask the Taoiseach if this resolution is designed to continue the surcharge of 10 per cent imposed last June on all the bands of income tax, except the lowest, and to continue it as a feature for the whole of the financial year 1976-77?
The resolution provides for the continuation in 1976-77 of the 10 per cent surcharge imposed in 1975-76. The appropriate section will be included in the Finance Bill. In case the Bill is not enacted before the 6th April, it is regarded as necessary to put it in now. It continues the rates as applied in the supplementary budget.
The Taoiseach will appreciate that when it was introduced it was represented by the Minister for Finance as being a temporary measure for the last financial year. Its continuation this year would certainly have ominous implications and could well become a permanent feature. The alleged plans of income tax laid down in the revised scheme for income tax in the Finance Act, 1974, would be irrelevant if this is allowed to continue any longer.
This continues specifically for 1976-77 and it would require further amending legislation to continue it.
I mentioned in the course of my general remarks on the budget in regard to income tax generally that it was introduced as a temporary measure.
I gather Gladstone introduced a tax as a temporary tax but——
It became permanent.
Will this 10 per cent be renewed from year to year? Is that the idea?
Sufficient for the day. It is in for this year.
People would like to know. Can we take it that it will go on from year to year in this way?
(Dublin Central): The average taxpayer would not like to see it remain there permanently.
Would the Taoiseach agree that the continuation of this 10 per cent surcharge on income tax, which was introduced as a very temporary measure and as part of a particular package, added to all the other measures in this budget, represents the final intolerable excruciating burden on the unfortunate middle class of this country?
No, because the reliefs given in the package are still in operation.
Would the Taoiseach either confirm or deny that it is the overall objective of this Government to wipe out the middle class?
In this budget we are giving relief in the personal allowances. For years under the Opposition they remained static. No relief was given. We have given relief every year, including this year under very difficult circumstances. That is a relief to the middle class who suffered excruciating burdens under the Opposition.
(Dublin Central): There was not an increase of 13p on the gallon of petrol.
In view of the Taoiseach's statement, might I be permitted to inform him, because he is probably not aware of the fact—I do not think he would have made that statement if he were——
I know what the Deputy is going to say—he gave it once.
What I am about to say is not what the Taoiseach thinks. When the Government of which he is Taoiseach introduced increased allowances under income tax, they left the taxpayer worse off in real terms than he was when Fianna Fáil left office. Since then the position of the taxpayer has steadily been eroded and the reliefs proposed in today's budget, to which the Taoiseach has referred, seem to vary between an increase of 2 per cent and 10 per cent in the allowances. They do not even remotely keep pace with inflation. The alleged reliefs, the nominal provisions, made in today's budget improved the taxpayer's position to the extent that there is an increased allowance but he is relatively worse off than he was the last year. These are the facts of the situation.
The fact is that in the tables circulated with the budget the Deputy can see that a taxpayer will pay less tax in 1976-77 than he did in 1975-76.
Is the Taoiseach speaking of people whose incomes did not change between 1975 and 1976?
There are different bands here and the Deputy can see the different rates for each one.
The fact is that in real terms the income taxpayer has been worse off since Fianna Fáil left office and his position is now worse still. Is that not a fact?
No, he is paying less tax this year than he was last year as a result of the relief given in the budget.
Can the Taoiseach give us an estimate of the expected revenue to the Exchequer from the increase under this resolution?
£10 million.
