Vol. 471 No. 1
63 Mr. Callely asked the Minister for Finance his views on the likely reductions in direct and indirect taxation over the next five years; the specific areas in which reductions have been considered; and if he will make a statement on the matter. [16654/96]
The Government's policy in relation to taxation is set out in the programme, A Government of Renewal. The programme stresses the need to reform the tax system, in particular to relieve the tax and PRSI burden on those with low incomes and especially those with families. Tax reform will favour the incentive to work, tackle the poverty trap, aim to reduce the tax wedge and encourage enterprise development.
The primary focus of tax reform has been, and will continue to be, on reducing the level of income tax while implementing base broadening measures, where appropriate. This strategy of concentrating on income tax reduction is guided by the desire to underpin moderate wage developments agreed with the social partners.
As regards specific areas where direct and indirect tax reductions may be considered over the next five years, this is a matter for consideration by the Government in the run up to each budget, in the light of prevailing budgetary and economic circumstances as well as developments, if any, at EU level.
