McCreevy Criticised Over Tax Policies

by Jason Gorringe, Tax-News.com, London

20 February 2002

Irish Finance Minister Charlie McCreevy has once again found himself under fire from all sides this week, as opposition party Fine Gael rubbished the Government's tax policies, and former Taoiseach, John Bruton, launched a vicious attack on Mr McCreevy's new tax break for resident sports stars.

Releasing its election pledges on taxation, Fine Gael warned that 'major corrective action' is needed in order to prevent Government debt from spiralling out of control.

Fine Gael promised that if they are successful in the forthcoming election, they will take the country's lowest earners out of the tax net, introduce a new tax rate of 30% for portions of the salaries of middle income earners, and introduce tax credits for single income families. On the business front, the party also pledged not to increase corporate or capital gains taxes.

The opposition party's finance policies have been criticised by some as being a little short on detail - no explanation has been made as to how the party intends to finance these pledges, other than by 'good management of the economy'. However, Fine Gael has revealed that borrowing would have to be considered in order to keep major infrastructure initiatives on track, and current expenditure would be clawed back.

Meanwhile, former Prime Minister John Bruton launched a stinging attack on the recently announced proposal to give tax breaks to sports personalities who have been resident in the country for over 10 years, arguing that it sets a discriminatory precedent. He called for the Finance Minister to drop the new provision from his budget, condemning it as a 'Haughey-style measure'.

'If economic conditions were to turn for the worse, this special tax write-off will make it much harder to persuade ordinary people to accept nationally necessary sacrifices,' he predicted.

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