TAOISEACH ENDA Kenny has firmly ruled out any increase in income tax in December’s budget.
Speaking at a joint press conference with Tánaiste Eamon Gilmore to mark the Government’s first 100 days in office, Mr Kenny clarified comments on tax by Minister for Finance Michael Noonan in the Dáil last week.
Mr Kenny said Mr Noonan had adhered strictly to the principle, followed by all ministers for finance since the foundation of the State, not to comment on what might or might not be in any particular budget.
“But as head of Government, I can say this in respect of the programme for government and this is very clear: there will not be any income tax increases in the budget.”
Mr Kenny said the commitment not to raise income tax was fundamental to the programme. It was also important for people to be able to plan their lives on the basis of the commitments.
“For that reason, that element of the programme for government is one that we will adhere to very strictly and very clearly.”
In the Dáil last week, Mr Noonan refused to rule out tax increases or reductions in future budgets. On the pension levy issue, he said the fiscal correction required next year would be €3.6 billion.
“Over the two years, therefore, we will approach a correction of €10 billion, a huge amount of money. In those circumstances, I will not rule out any tax initiative, increase or reduction.”
However, the programme for government would provide the principles on which he would base his tax approach, he added. The programme commits the Government to “maintain the current rates of income tax together with bands and credits”.
The Taoiseach also said at his press conference that the Government’s first 100 days had marked a decisive step on the road to recovery.
The Government had started to fulfil its promise to improve the terms of the EU-IMF programme and Mr Kenny called on EU leaders to recognise the progress Ireland had made.
“Our message is clear. Ireland is making huge sacrifices to help solve the euro zone crisis. If we can grow out of this crisis, we can pay our way.
“But this is a financial crisis. It’s not a sociopolitical experiment to see how far the Irish people can be pushed, how much they can take. Consequently, European leaders must step up to the mark and put aside their domestic political agendas and, at this crucial juncture, support countries who are working towards recovery.”
Mr Kenny expressed the hope there would be progress after his meeting with French president Nicolas Sarkozy at next week’s European Council in Brussels.
Mr Gilmore said no previous Irish government had inherited such a complex emergency, which he described as a battle on three fronts: a crisis of unemployment, a crisis in the public finances and one of the most severe banking crises in Europe.
“It will not be easy. There is no silver bullet that will solve all our difficulties. But we will succeed, the way the Irish always have: by sheer hard graft and determination.”
