Gilmore defends maternity benefit tax

Tánaiste Eamon Gilmore has defended moves to tax maternity benefit by insisting mothers will not be worse off as a result.

The move, which opposition parties branded “anti-family” when it was unveiled in the budget, could see working mothers pay up to €2,700.

The tax will be imposed from July with mothers either paying at the 20%, or 40% rate.

The Tánaiste said women would keep the equivalent take-home pay they had at work while on maternity leave. Mr Gilmore accused the opposition of “twisting” the facts.

“A woman who goes out on maternity leave will have the same take home pay the week she goes out on maternity leave as the week she was at work so there is no cut in the take home income of any women going on maternity benefit.

“It was only fair that two individuals earning the same amount of income should pay the same amount of income tax, regardless of whether that income came from pay or maternity benefit.

“A woman on maternity benefit, whose employer continues to provide a full salary during maternity benefit, will continue to receive precisely the same take-home pay as she did while working,” Mr Gilmore told the Dáil.

The tax will deliver some €40m a year to the Exchequer as mothers receiving the average six months payment of €6,800 in maternity benefit will have to pay up to €2,700.

This alters the current situation where women pay tax on the “extra” contribution by their employers which bump them up to their full wages while on leave.

Fianna Fáil leader Micheál Martin said the tax, coupled with the €10 cut in child benefit, would have a negative impact on families.

“Women do not go on maternity leave to earn extra money and that suggestion and assertion by the Government should be withdrawn.

“For working women who already have made a significant contribution through PRSI and have paid substantial amounts to it, this tax is highly unfair because there are additional significant costs associated with pregnancy and childbirth and this particular maternity benefit always has been a cushion to protect families against such costs.

“The Government had choices but has made a wrong choice in this case,” he told TDs.


Lifestyle

It hasn’t been the ideal summer for observing the skies, but as we move into September we live in that almost annual hope of an Indian summer, writes Niall Smith.Skymatters: Enjoy the last of the summer stars and check out 'Vega'

Actually the lights were on when I got dressed this morning, says Luke Rix-Standing.11 things you’ll only know if you have no sense of style

Robert Hume unveils the Irishwoman who became the world’s first car accident fatality.Did you know an Irishwoman was the world’s first car accident fatality ... in 1869

Meet Lisa O’Doherty, the chief sommelier at The K Club.You've Been Served: Lisa O'Doherty of The K Club on life as a chief sommelier

More From The Irish Examiner