In its Pre-Budget statement issued today, independent think-tank TASC estimated that tax breaks will cost an estimated €7.4bn by the end of in 2009.
The organisation said that an overhaul of tax breaks could contribute significantly to the €4bn in cuts being sought by the Government in Budget 2010.
TASC said that the Irish tax system provides more tax breaks than other EU members, and that, in general, tax breaks disproportionately benefit the better-off, and therefore reinforce economic inequality.
The think-tank has recommended that a one-year ‘sunset clause’ (automatic expiry) be attached to all tax breaks.
Tax breaks would then only be introduced or, in the case of existing tax breaks, continued beyond the sunset clause if they satisfy an equality and economic efficiency audit presented to the Oireachtas.