A €10 cut to child benefit is expected to be announced in the upcoming budget. Some 600,000 households receive the universal rate which will fall from €140 to €130 in a measure that is expected to save the State €138 million in a full year and is likely to be the biggest single cut in social protection.
The Cabinet has been meeting this week to discuss next Wednesday’s budget.
A report commissioned by the Department of Health suggests introducing a “payroll tax” to fund increased health spending.
“A new source of statutory revenue could be introduced, for example a payroll tax earmarked for health to supplement general revenues,” the report says.
It also recommends hikes on alcohol and the creation of “sin taxes” on certain foods. The report justifies these taxes on health grounds, adding that they would result in reduced consumption and increased tax revenue.
Meanwhile, media reports today suggest medical card holders face a doubling of the 50 cent prescription charges in the Budget. Changes to the over-70s medical card and the home package of free TV licence, electricity and telephone allowances are also being considered.
It has also been reported that the time for which non-means-tested dole is paid will be cut from 12 months to nine months.
It is also understood the Cabinet has given formal approval to Attorney General Máire Whelan to draft legislation for the introduction of a controversial property tax.
Meanwhile Minister for Transport Leo Varadkar today said there “may be an increase in carbon tax” but he was not aware of any plans for a fuel price increase.
The major reason for the increase in fuel prices in the last two or three years “is not taxation it’s the increase in the price of oil,” Mr Varadkar said at Malahide Castle.
Asked about increases in Vehicle Registration Tax he said “any increase in taxation is going to be used to reduce the deficit”.
The Cabinet will meet for a third time tomorrow to finalise a budget package. Government sources indicated last night the property tax will be levied at the rate of 0.2 per cent of market value. This means that a property tax of €500 will be levied on a house worth €250,000 with €1,000 falling due on properties worth €500,000.
Reports emerged today that elderly people will have the opportunity to have the property tax on their home deducted from their estate after they have died.
Council house residents face a rent increase of €1 to €2 a week, which will generate €50-€100 a year per house
A new format for the presentation of next Wednesday’s budget will see Mr Noonan introducing the main taxation measures in a 40-minute speech. He will be followed immediately by Mr Howlin.
United Left Alliance has called for debt repudiation and higher taxes on wealth in its pre-budget statement today.
Among its proposals are to repudiate all debt deriving from the financial crash , to introduce a wealth and financial transaction tax and to impose a minimum effective corporation tax of 12.5 per cent.
It proposes increasing income tax on the wealthiest 5 per cent of society by €2.5 billion through graduated tax bands up to 70 per cent for incomes over €200,000.
There has been much concern raised over the rumoured budget measures by Opposition TDs and advocacy groups.
Cutting child benefit in next week’s budget would ratchet up the pressure on already struggling families who cannot afford to take any more cuts to their income, according to Fianna Fáil spokesperson on social protection Willie O’Dea.
In a statement, Mr O’Dea said: “Targeting child benefit in this way is a further attack on families with children. Currently in Ireland there are 250,000 children living in families that are below the poverty line - we should be trying to protect families, not target them."
There was no denying "tough decisions" need to be made, he said, but the Government did have choices "and unfortunately they seem to again want to target children".
“Let’s not forget that the full impact of the 2012 cuts to child benefit will only come into effect in January. Assuming the new cut will be for the first two children, a family with four children will now find themselves down €1,008 a year (€240 this year and €768 from last year’s cuts) compared to 2011."
The cut may be marginal, he continued, but it could have "a devastating effect"on families. He claimed Fianna Fáil had shown the €3.5 billion budget adjustment can be made this year "without touching child benefit. Our alternative budget proposals propose an even split between spending cuts and taxes, which is a fairer approach."
Tough questions now had to be asked of Minister for Social Protection Joan Burton, he added. "Time and time again Minister Burton has promised not to touch core social welfare rates; this is a blatant row-back.
"I find it incredible that a Labour Minister, whose election campaign was based largely on a pledge to fight any reduction in child benefit, would even consider such a proposal."
Any cut in child benefit would be a “blatant breach of election pleges from the Labour party” Sinn Fein health spokesman Caoimhín O'Caoláin said in a statement today.
It would be an “outrage” shortly after the passing of the children referendum to “attack” child benefit and hit the most vulnerable children and families, he said.
The prescription charge for medical card holders was something Minister for Health James Reilly opposed when introduced by former health minister Mary Harney, he said.
“Not only has he failed to abolish the charges as he demanded in opposition, but he now proposes to increase them”.
The Irish Senior Citizens’ Parliament today urged older people to contact their local TD to express concern about cuts. “Remember everything is still on the table and there is still time to influence the outcome of the budget process,” chief executive Mairead Hayes said in a statement.
Advocacy group Mental Health Reform has urged people to contact Cabinet ministers urging them to keep the Programme for Government promise develop community mental health services. On Wednesday Minister of State for Mental Health Kathleen Lynch said she cannot guarantee there will be no further cuts to the sector’s budget.
Disability groups have expressed fears over the impact of cuts in services and benefits which would be “destructive” of people's “capacity to continue to participate in community life,” the Disability Federation of Ireland (DFI) said today.
After a “flood of cuts” in the past five years, people with disabilities are “deeply troubled about what is in store”, DFI chief executive John Dolan said.
The organisation that represents Ireland’s private bus and coach companies has called for a user rebate in its pre-budget submission. “There is widespread expectations that Ireland’s road hauliers will receive a rebate, and the bus and coach companies are determined that they won’t be overlooked,” the Coach Tourism and Transport Council said in a statement.
The Government has been urged to give clear guidelines on the expected property tax. If the property tax is based on the market valuation model, clear guidelines on self-assessment will need to be provided to householders, the Society of Chartered Surveyors Ireland has said.
“It should be remembered that valuation is a subjective area and multiple factors came into play when deciding on a valuation, especially in the current market,” society president Roland O’Connell said in a statement.