FINANCE Minister Brian Lenihan has questioned whether the country could cope with the introduction of a property tax in the short-term.
He said while a tax on people’s homes would generate cash for the state, it would hurt spending in the economy and restrict transactional taxes linked to this.
“If you keep endlessly increasing taxation you destroy confidence in the economy.
“It is very difficult if you are talking about capital taxes in the current climate to talk about property taxes because that is just another capital tax,” he said.
Mr Lenihan said he favoured finding ways to cut spending instead of jumping to raise taxes on property and inheritance. And he said it was particularly problematic to introduce a property charge when values were so low and incomes so depressed.
“The problem with a property tax is people still have to pay it, it is paid out of income,” he said.
The Government has told the International Monetary Fund it is considering a property tax, which was recommended in last summer’s Commission on Taxation report.
However, Fianna Fáil backbenchers have resisted the possibility of its introduction in the short term.
In an interview with Sam Smyth on Today FM, Mr Lenihan also made an astonishing attack on Fine Gael by saying they missed an open goal when they failed to oust Fianna Fáil at the last general election.
“I expected Fianna Fáil to lose the last general election and I was surprised when we were returned to office.
“In my view at the time there was an abject failure by Fine Gael to offer a viable alternative to the people,” he said.
Mr Lenihan said the policies Fine Gael put forward in 2007 helped Fianna Fáil to recover a lot of lost ground in the final week of the campaign.
The Finance Minister did not entertain the possibility of himself leading the party into the next general election.
He said in spite of his current popularity and Taoiseach Brian Cowen’s poor poll rating, he believed the current leader should remain in office.
Regarding his own health and treatment for pancreatic cancer, Mr Lenihan said he was waiting for the outcome of tests this summer.
But, he said, he was still feeling good and his ability to do his job had not been compromised.
He said the support he has received from across the political party spectrum has been a big comfort.
“[What has been a] a huge support to me is the presence I seem to have in the thoughts and prayers of many. That has been a huge personal support to me in what has been a difficult time. And I very much appreciate that.
“As far as my actual position is concerned there is no change since January, I am in a position to do my job,” he said.
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