: I move amendment No. 1:
In page 7, after line 52 to insert the following:
"(2) Notwithstanding section 5 of the Finance Act, 1977, the rates specified in the following Table shall, for the year 1978-79 and any subsequent year of assessment apply to married persons.
Part of Taxable Income |
Rate of Tax |
Description of Rate |
|||
(1) |
(2) |
(3) |
|||
The first £625 |
20 per cent. |
the initial rate |
|||
The next £1,250 |
25 |
,, |
,, |
,, |
reduced rate |
The next £3,750 |
35 |
,, |
,, |
,, |
standard rate |
The next £1,875 |
45 |
,, |
,, |
,, |
higher rates. |
The remainder |
50 |
,, |
,, |
On Committee Stage I made the point, which has been borne out by a number of newspaper references in an extremely interesting article—which we should all read—in last week's Economist of the coming revolution of the taxpayers. I am sure they are dramatising the situation but in that article they say that in 20 years' time the taxpayers will resort to violence if they do not get their way. More and more people are sucked into the tax net every year or even into the marginal tax net, which is far more expensive than the ordinary one, because of inflation and stable tax bands. The Minister argued on Second Stage and also on Committee Stage that he has increased the allowance dramatically for people paying income tax. That is true of the marriage allowance, which has been increased quite considerably. It is the bands which should be increased if we are really sincere about not taking a larger slice of peoples' incomes than before.
I put down my amendment to try to get the bands to bear some relation to the value of money. I suggest that over a four-year period they should be increased annually by 25 per cent. This means that the £500 band would now become £625 and the next band of £1,000 would become £1,250. I believe the sense of discontent which many taxpayers feel would be offset if they were ensured of the goodwill and determination of the Government and of the Oireachtas not to see their position worsened because of the effects of inflation on their salaries. The effects of inflation would be offset by the widening of the tax bands so that they would be increased this year by 25 per cent and by 25 per cent in the years to come. I feel this is a worth-while reform in the tax system, which would ensure that when any extra pounds wage earners get, moves them from one tax band into a higher tax band its effect will be offset.