I welcome the Bill and acknowledge its important role in delivering commitments in the programme for Government, as well as tackling many of the pressing challenges that people are facing. In recommending a number of provisions in the Bill, I would ask the Government to do everything possible to pass and implement them for the benefit of home owners, businesses and citizens generally.
The first matter I wish to raise concerns the provision to attract people into the country and in return for them providing employment, a tax plan will be put in place to ensure they establish businesses so that particular skills needs can be met. A current example concerns requirements in the digital and ICT sectors. Many such companies across the world are seeking to invest in businesses, thus creating jobs in those sectors which are capable of employing Irish graduates and others. Having spoken to people involved in these industries, I know they are seeking the kind of measures contained in the Bill. The legislation, when enacted, will mean that Ireland is putting together a competitive offering so that our corporation tax rate and regulatory regime will be strengthened.
I also commend the measure which will strengthen arrangements for mortgage interest relief for those who bought homes over a certain period. Fine Gael made this commitment during the general election last year but prior to the budget there was some doubt as to whether it would be implemented. The fact that is has happened shows how seriously the Government takes the issue of negative equity. The Government also recognises the pressure on people who bought homes at a point in the property cycle when the former Government had abandoned any responsibility of care or any pretence to regulate the economy. The Government intends to do all it can to provide support for such people by implementing these measures.
In addition, income tax rates will not be increased, while tax bands and credits will not be changed either. This is an important decision in the context of the programme for Government and the challenges the public are facing. This is the first budget in recent years that will not result in a direct increase in income tax rates, the universal social charge or other payments. We are trying to do all we can to stimulate the domestic economy, as well as providing more confidence to boost consumer spending, so a measure such as this is of great importance.
One consequence of this decision has been that other additional benefits and supports have been changed. In the coming year, people will examine their available income after tax, and the vast majority will find that there is no change at all in their after-tax income as a result of this Bill being enacted. When the public have greater certainty about their money and more confidence to spend it, the delivery of this commitment in the programme for Government will be seen as hugely important.
The Bill must also be seen in the broader context of what is happening within the European economy and the commentary on what is happening here. In recent months, Opposition Members have quoted the fact that Irish bond yields were going up and were unsustainable. They also said that Ireland would not be able to meet its commitments in the programme for Government and would not be able to return to the financial markets in the near future. Of course, those Members are now silent about the international perception of Ireland and the recognition of what is happening with bond yields and Irish debt.
It was particularly significant yesterday that Wolfgang Munchau, a commentator with theFinancial Times, published an article on what could happen to countries with external aid programmes, and the grim prospects that await them. Ireland was not mentioned anywhere in the article. That was a clear recognition from a commentator - who had pretty pessimistic views on prospects for the European economy and members of the eurozone - that Ireland is now set on a different course. Mr. Munchau recognised that Ireland is doing all it can to exit the external aid programme and will find itself well placed to return to the financial markets in a graduated manner in 2014 and 2015. All of this is vital for our country.
We can see what happens when these commitments are not met, given the terrible vista unfolding for the Greek people and their economy. It is vital therefore for the Government to do all it can so that Ireland will not face such a prospect and instead puts itself on a path to sustainable economic recovery and job creation, as well as meeting the commitments in the programme for Government. I have no doubt that we will do so and the Finance Bill is an important part in that journey.
I also wish to comment on the commitment in the legislation concerning the universal social charge. For many people, the creation of that charge and the rates of income at which it was to be levied have created a major difficulty. In many cases, the USC's application rates were below income tax rates and also below the average paying wage in many sectors of the economy.
One of the Bill's measures that will have a beneficial effect on particular parts of the economy is the commitment given by the Minister for Finance to ensure those whose total annual income is around €10,000, coming from a succession of part-time roles or temporary working arrangements, are taken out of the brackets of the universal social charge, USC. It is important this is done because it is an issue of equity and fairness. Is it appropriate those at that level of income should be paying over a part of their income to the USC? It is also important because for those earning such a level of income their level of savings would be very low. It is likely, if not certain, that the income they get back from this exemption will not be saved but go directly into spending in the economy, in shops and in the local community.
Another measure in the Bill I commend is the innovative referencing to emerging market economies in which we are looking to grow our exports. Currently, our share of exports to these economies is low. At a time when developed economies across the world are seeing their rates of economic growth begin to go down, it is vital we incentivise and support Irish companies to find markets elsewhere and diversify our export base. The Bill's measure which allows companies, whether big or small, to be incentivised to go to Brazil, Russia, India, China and other markets in search of exports is to be welcomed. I hope organisations with a role in supporting our export performance, such as Enterprise Ireland, will dovetail together to ensure and incentivise Irish companies looking to win contracts or sell their goods abroad in these emerging markets. A significant challenge we are facing is we are very dependent on the performance of our exports. Last year, we exported over €160 billion worth of goods but as the economic growth rates of the markets to which we currently export slow down, it is vital we find other markets to which we can export and other peoples who will buy our goods and services. While it is a small measure in the Bill, it indicates the Government understands the potential vulnerability of our future export performance. It is incumbent on other State agencies to ensure Irish companies can access this measure and these emerging markets.
I welcome the Finance Bill 2012 which contains several particularly worthy measures. For the first time in several budgets we have not seen income tax rates increase. A vital programme for Government commitment to put in place additional measures to strengthen mortgage interest support for those who bought homes across the peak of the housing boom has been met. Many doubted this would happen but it did. Several other measures will strongly support our companies engaged in export markets by attracting individuals to work in Ireland who will be capable of generating jobs. An additional important measure will support companies selling goods and services to emerging markets. I hope the companies targeted by this measure will be made aware of it and do all they can to take advantage of it.
I welcome the unexpected opportunity to speak on this Bill. I hope to see its passage through the House and the implementation of many of its measures play an important role in ensuring the economy moves towards recovery.