asked the Minister for Finance if he agrees with the EEC commissioned report published on 20 September 1984 that tax changes must be made if the unemployment situation in Ireland is to improve; if he agrees (1) that capital gains on start-up funds be tax-free, (2) that savings with which to start an enterprise should be tax-free and (3) that there should be no further tampering with tax allowances until the entire tax system is reformed.
Written Answers. - Tax Changes.
447.
It is assumed that the Deputy is referring to an appendix to a preliminary draft report by the EEC Economic and Social Committee on the EEC Commission's Annual Economic Report 1984 which was publicised recently. This draft does not explicitly link tax changes with improvements in the unemployment situation in Ireland although it does point to the sensitivity of industry to the tax environment. In the recently published plan the Government have pledged that over the period of the plan there will be no increase in the overall level of taxation. I am confident that this commitment in conjunction with other measures in the plan will create a climate favourable for employment.
With regard to the specific queries raised by the Deputy, I might point out that the existing reliefs and exemptions in capital gains tax ensure that an investor can retain a fair share of the gain on the disposal of his investment. There is, in my opinion, no case for further reliefs in this area. Tax-free savings instruments are already available to anyone wishing to save in order to start up a business and I have no plans at present to introduce a measure on the lines suggested by the Deputy. As outlined in Chapter 6 of the plan, I intend to make as much progress in reforming the tax system as is possible within the context of the commitment that there will be no increase in the overall level of taxation.