Harney Crushes Hopes Of High Rate Income Tax Cut In Ireland

by Caroline Maxwell, Tax-News.com, London

09 November 2001

Speaking at an investment conference hosted by HC Financial Services last week, the Tanaiste Mary Harney, scotched any lingering hopes of a reduction in the highest rate of income tax in the next budget. The top rate currently stands at 42%, and there had been suggestions in happier economic times that this could be reduced to 40%.

However, in the light of the effect of recent events and the global economic slowdown on government finances, Ms Harney told the conference, workers will have to rein in their expectations.

The Tanaiste reiterated the government's commitment to improving the situation of lower paid workers in Ireland, and stated that income tax reductions in Charlie McCreevy's next budget would be focussed on this group, in order to help to ensure that the Irish economy remains competitive.

She told delegates at the conference in Galway that the government was reviewing the number of work permits issued to foreign nationals, and hinted that a restrictive approach was being taken, despite previous reports which have suggested that over 30,000 foreign workers would need to be imported into Ireland each year in order to sustain economic growth.

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