Increasing taxes a detrimental option

INCREASING taxation in this year’s budget will act as a deterrent to employment, reduce spending and slow down economic growth and would be “detrimental in the extreme”, ISME has warned.

Outlining the critical importance of decisions taken in this year’s budget, ISME chief executive Mark Fielding said there was a strong argument for widening the tax base and introducing measures such as water and property charges as they would provide an element of certainty to future tax revenues.

“This year’s budget will be the first in a series of harsh budgets and a balance must be struck between raising taxes and cutting costs,” Mr Fielding said. “It is imperative the Government does not further dampen already reduced domestic demand, by excessive increases in income tax. With Exchequer finances in a mess, there is absolutely no option but to cut costs and the two main costs are the public sector and social welfare.”