Dáil Éireann Debate, Tuesday - 22 February 2022
8. Deputy Richard Boyd Barrett asked the Minister for Finance if he is considering further tax measures to alleviate the severe burden of heating and energy price increases; and if he will make a statement on the matter. [10105/22]
View answerThe Minister knows, and it has been discussed at length in this Chamber in recent weeks, that people are being crucified by the rising cost of energy and heat for their homes. Another report was published today, on a survey by Amárach, which shows that people are cutting back on food, meals and essentials because of the rising cost of heating and energy, a basic necessity to keep themselves warm. What tax measures is the Minister willing to consider to address the cost-of-living crisis that people are facing?
I appreciate the challenges many people are facing and I know the issues the Deputy raises are ones that too many are confronting. As I said in the debate earlier on carbon taxation, to be emerging from the very dark and difficult pandemic, with all that it meant for employment and income, for many to have to confront rising prices on top of this is a bridge that is hard for many to cross. I accept that, but it is not about the measures I am considering; it is about the measures that have been put in place by the Government. It is about the measures that were introduced in last year's budget. I accept that, with regard to many of the measures we brought in, the Deputy will be of the view that more can, and should, be done.
The changes we made last October that took effect in January included a €5 increase in the weekly payments that are vital to our social welfare code. Changes were made to the living alone allowance, the qualified child allowance and the fuel allowance. We made changes to personal taxation thereby trying to get to a point where more people pay the standard rate of tax on more of their income. This is the reason we increased the personal tax credits. In addition to the measures we put in place, it is about the measures that the Government announced last week. We made changes in the energy credit. There was a lump sum payment of €125 for those in receipt of the fuel allowance. In addition to what we have done on public transport, changes were made to the drugs payment scheme and other important schemes that affect the cost of healthcare. We have brought forward a package of measures that aims to respond to the challenge we know many are facing at present. These are measures that have either been implemented from 1 January or will be implemented in the coming weeks. We know many people need help and the Government is determined to do what it can to provide that help.
I am afraid it is just not enough. Heating and energy bills are set to increase by approximately €800. For many people, it will be more than that if their homes are badly insulated. In most cases, they have little control over that if they are tenants, public or private, or do not have the money to retrofit their homes. Who will make up the gap between the very small measures, such as social welfare increases, including an increase to the fuel allowance for those who get it, or the €200 energy credit and the cost-of-living increase? When it is added up, it is still well short of the increase just in the price of heating and energy, never mind how the cost of rent is rocketing and food prices and so on are going up. It is not enough. Does the Minister consider the fact - because he should - that the same people who are being crucified by these costs are paying €494 million in carbon tax, which the Government plans to increase, €481 million in VAT and €263 million in public service obligation levies? They are being crucified by taxes that he has the power to reduce. Does he not think that, given the unprecedented crisis we are facing, he needs to do a hell of a lot more?
I am increasingly being struck by the tone, particularly from some Members of the Rural Independent Group, and the venom with which the word "tax" is used. It is extraordinary for a Deputy of the far left, such as Deputy Boyd Barrett, who I would have thought understands the role taxes play in providing public services on which our country depends, to do so. These are taxes that I know are difficult for many people to pay, but they are also taxes that pay for our schools, hospitals, and the public services that are essential to our society. They are public services that many people, whom the Deputy represents through this question, depend on and want to work well. They also know that the funding of these services plays a part in the services working well or better in the future.
In regard to the measures brought forward, I know they will never be enough for the Deputy. I know any measure that I bring forward, short of the collapse of capitalism, is a measure that he will be unhappy with and make a case against. However, these are measures that will help those who are experiencing real challenges, which we accept and understand. They will be implemented in the coming weeks, in addition to the measures that were implemented on 1 January.
Between the wars, climate destruction and inequality that capitalism generates, it will not need me to help it collapse. It will be more likely to do it itself. I do want taxes put on those who are doing well from the current inflation crisis. As I pointed out to the Minister, why will he not consider taxes on the excessive profits of energy companies? Energia's profits were up by 46% last year and 45% the year before that. What about the profits of the oil companies or the ESB? Does the Minister think it is okay that poor people on low and middle incomes will be considerably worse off, some of whom are making the decision not to have meals, pay rent or medical bills, while the companies that are hiking up the prices are making obscene profits? Does he think he should possibly address that injustice? Does he think that he should possibly use the power he has, as the Minister for Finance, to tax their profits as against imposing crippling taxes on people who cannot afford it?
We are just bringing in measures that will increase the corporate tax rate for the largest companies - I am not sure of the turnover of these companies - by 15%. Corporate tax rates will go up. The Deputy will appreciate the challenge involved in doing this. I know he would want them to go up more. One of the reasons corporate tax rates are increasing is it is a challenge to look at how we can find ways in which very large, very complex and, at times, very profitable companies can be taxed more effectively and differently.
I refer to the point the Deputy made about the ESB. The ESB is a semi-State company and, therefore, the profits it makes are returned to the State via dividends. The dividends are used by the State to help fund public services that the Deputy wants to see improved. If a decision is made to reduce that level of profitability in any way, it would have a knock-on effect on other services the Government uses those dividends to pay for. That is the reality of it. As I said earlier, we appreciate the significant pressure that so many people face at present. We know the measures we are bringing forward, for many, will only help, but we are bringing them forward in recognition of the challenges they are facing. They can and, I believe, will help.
