I move amendment No. 11:
In page 4, subsection (1), line 36, after "earnings" to insert "in excess of the personal tax free allowance, prevailing in the year in question under the Income Tax Acts, of the said contributor".
While the Minister argues that the ¼ per cent levy applied only to employers, everyone now recognises that much indigenous industry in particular is relatively low paid and has been particularly disadvantaged by levies with no threshold. It would be in the interests of all concerned that where the average wages are small, the levy would not be exacted from the whole lot. In the interests of equity there should be some figure below which an employer paying such earnings is not levied. It has to be borne in mind — the economists will confirm this — that at the end of the day there is a wage fund from which people's wages are paid, and if one puts a ¼ per cent levy on the employer, at the end of the day half of it is paid by the employee and half by the employer. That is the way supply and demand works. Any basic economics textbooks will show that that is what will happen.
The argument that just because it is levied, the incidence is on the employer does not mean that the employee is not affected as well. It would be progressive and a good signal of concern to low paid workers that we would establish this levy in a way in which it had built-in favouritism towards the low paid. Indeed, I would argue, if I had the chance and if we had the Minister for Finance here before us today, that he also should be looking at a similar threshold for PRSI levies generally. The clothing and baking industries and industries traditionally not very highly paid are the ones being pushed to the wall by PRSI, not the multinationals. I realise it would be quite a reform for the Minister to embrace, but I ask her to consider it and maybe even signal her willingness to talk to other Ministers whose approval would be necessary before she could accept such an amendment.
