PROPOSALS on how the tax and social welfare systems can be used to provide more encouragement for people to take up jobs are to be put to the Cabinet.
They will be drawn up by the Ministers for Social Welfare and Finance and will be based on the report of the expert working group on the integration of the tax and social welfare systems.
The report, details of which were revealed yesterday in The Irish Times, calls on the Government to apply five principles in its approach to tax and welfare. These are that there must be a reward for working, the transition to work should be facilitated tax on the lower-paid should be reduced, the tax and social welfare systems should be simpler and tax and social welfare reforms should be co-ordinated.
It calls for higher personal tax allowances but opposes the abolition of PRSI contributions.
The expert working group was chaired by Mr Donal Nevin former ICTU general secretary.
The Irish Business and Employers' Confederation (IBEC) welcomed the report, saying it "gives focus to the extreme financial disincentives faced by many unemployed in taking up employment.
"According to the report, over one third of the unemployed would only be marginally better off in employment."
The lesson was that the overall tax burden should be reduced by curtailing the growth of public spending.
The group's rejection of the concept of a basic income from the State for everybody - on the grounds that it would require a 68 per cent tax rate on other income - was criticised by the Justice Commission of the Conference of Religious of Ireland (CORI). A basic income as envisaged by CORI would lead to a decrease "in the effective tax rates paid by most people" it said.