asked the Minister for Finance in what EEC countries personal income tax is paid by the farming community; and what effect EEC membership may have on the agricultural community in the field of income tax being paid by them.
Ceisteanna—Questions. Oral Answers. - Membership of EEC.
25.
On the basis of available published information, it would appear that the farming community in every member country of the EEC is chargeable to personal income tax in respect of farming profits.
As the European Economic Community has no plans for the harmonisation of personal income tax we would not be obliged, on joining the Community, to alter our existing treatment of farming profits for purposes of personal taxation.
In the event of harmonisation being introduced, I take it that income tax for farmers will have to be considered here?
I think it might be misleading to say that, although logically what the Deputy says is correct. The information available would indicate that it seems unlikely that the matter of taxation of agricultural profits in Ireland will become an issue in the EEC in the foreseeable future.
Would the Minister agree that provisions regarding taxation in the EEC are confined to indirect taxation?
That is so.
The Minister has confined his reply to personal income tax. Is it not the case that there will be a significant development in taxation through the system of value-added tax? Would the Minister like to comment on the way in which VAT will bear on the farming community, because direct taxation will be only a portion of the income tax the farmers or any others will have to bear?
The effect of bringing the farming community under the VAT is to leave their net tax much the same as at present. It does not increase their liability. They will be liable to recover such tax as will be payable on their inputs.
26.
asked the Minister for Finance if his attention has been drawn to the circular published by the National Anti-Common Market Action Committee showing food price disparities between EEC countries and Ireland; if the comparative prices shown are correct; and, if so, if he will indicate how wages and social welfare benefits will be increased to meet the higher food prices.
I have not seen a copy of the circular, which I am informed is out of print, and, accordingly, it is not possible to reply to the first part of the question.
Estimates of the effects on food prices of the alignment of Irish agricultural producer prices with those obtaining in the EEC are set out in the White Paper entitled "The Accession of Ireland to the European Communities" which was published last week. These estimates show that the annual increase in food prices over the transitional period would be about 2-3 per cent and the consequential increase in the consumer price index should lie between 0.7 per cent and 1 per cent per year.
As indicated in the White Paper, it is expected that the increases in prices will be more than offset by the higher real incomes which will result from EEC membership. Consumers should also benefit from the introduction of free movement of goods which, it is anticipated, will reduce the rate of increase in prices of non-food items. It is stated in the White Paper that the annual net savings to the Exchequer arising from EEC membership—of the order of £25 million to £30 million a year—will be available to finance increased social expenditure which would benefit the lower income groups who would be most affected by price increases.
Can the Minister say how he expects to win the referendum when the White Paper he refers to contains no basis whatever for the calculations although, as I think I have shown in an article in The Irish Times, the results are correct? No basis is given.
Ours are more conservative than those suggested by the Deputy.
The Department's figures were 3½ to 5 per cent in the five year period over that range, and my figure was 4 per cent, which would fall very near the middle of the Minister's range. How can the Minister expect to win the referendum when he cannot even get a copy of one of the principal propaganda documents?
We cannot have an argument at Question Time.
Did the Minister ask the relevant organisation for a copy of the document?
So far as I know, none of the Departments concerned with the EEC received any such document or were able to lay hands on it.
Did they ask the people who published it for a copy?
It is very difficult to ask for a copy of a document you do not know exists.
The question drew attention to the existence of the document. Did the Minister take the normal course at that stage of asking the people concerned for a copy of it?
On receipt of the question?
Yes.
I understand that was done and we were told it was out of print.
That is a very interesting way to try to win a referendum campaign. Will the Minister make sure that he gets a copy of all such documents?
We would be pleased to be put on their mailing list.
The other side will suppress them if they can.