Tánaiste and Minister for Finance Simon Harris has said this year’s Budget will support people “who get up early every morning and go to work”.
Addressing a Mullingar Chamber of Commerce pre-Budget breakfast briefing, Mr Harris said that “if you work hard, you should be able to get ahead, not just get by”.
He said strong towns and strong communities across the country depend on people “who are prepared to work hard in order to get ahead”.
The Tánaiste also said there will be a business package that will make progress on reducing the cost base for business owners while also “increasing your ability to make ends meet”.
He said cutting business taxes and cutting income tax “are the priorities” as budget negotiations enter their final stage.
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Earlier, Social Justice Ireland’s (SJI) Research and Policy Analyst Michelle Murphy said tax credits are the fairest way to deliver any income tax package in next month’s Budget.
Speaking on RTÉ’s Morning Ireland, she said tax changes need to be fair and targeted to lower paid workers.
She explained that SJI’s analysis suggests that the fair outcome is increasing the two personal tax credits because every worker earning above €20,000 will benefit from that.
She said that the Government and the Minister for Finance have mooted increasing the standard rate band by €2,000 in terms of changing the entry point at the top rate of tax.
“That actually doesn’t have a fair distributive impact because if you’re earning less than €44,000, you’re not going to benefit from that.
“And that’s really problematic because if we are going to look at changes to the income tax system, then you have to make sure that those changes will be fair, and the benefits will flow to all workers,” she said.
Ms Murphy added that given the limited resources we do have available, “we should make sure that they’re targeted at those lower wage workers and the fairest way to do that really is through the tax credit system”.
She added that the middle-income earners would also benefit as they would also see their tax bill fall if there was an increase to tax credits.
“They would see a substantial fall in their tax bill”, she said.