'Scrap the Universal Social Charge,' says Sinn Féin's Aengus Ó Snodaigh

Aengus Ó Snodaigh signs a pledge by Sinn Féin to reverse the cut in the minimum wage

SINN FÉIN TD Aengus Ó Snodaigh has today called for the scrapping of the Universal Social Charge and its replacement with a higher tax band for people earning in excess of €100,000.

Deputy Ó Snodaigh said:

The Universal Social Charge is basically a flat tax: everyone with an income above €16,000 pays it at the same rate of 7%. As such it breaches the fundamental principle of progressive taxation – that those who have more, should pay more.

He said the Government has not conducted research into the impacts of this tax hike or the social welfare cuts on the families affected or on local retail trade.

They have blindly pursued a policy that is pushing ever greater numbers into poverty and deflating the economy.

Indigenous domestic business is absolutely vital for Irish employment and these will be hard hit by the Government’s deflationary policy.

Retail Excellence Ireland has recently claimed that the USC was crippling consumers and putting off any hope of a recovery.

The ESRI and the Central Bank have in recent weeks revised down their forecasts for 2011, reflecting the growing concern about the impact that the Government’s harsh and deflationary budget will have on domestic consumption.

Aengus added that the Fianna Fáil Government “seemed determined to protect the tax exiles and the wealthy”.

Sinn Féin has proposed a wealth tax of 1% on assets of over €1 million and a 48% tax rate on individual incomes over €100,000.

There is no evidence that either proposal was even considered by the Government. Even the limited measures announced in the Budget – ending the remaining Section 23 property-based tax reliefs – have been kicked to touch, with their implementation postponed pending an impact assessment by a government-appointed committee.

It’s interesting that the Government felt the need to carry out an impact assessment on the removal of Section 23 property-based tax reliefs but no impact assessment on how low and middle income earners and indeed small business would be affected by the Universal Social Charge.

Sinn Féin wants the repeal of the Universal Social Charge.

Any party wanting to form a government after the next election should introduce a new budget as its first priority and abolish this regressive tax.