Tax hikes on cards for higher earners, junior finance minister suggests

High earners can afford to pay more in tax, a Fine Gael minister has said.

Brian Hayes, who holds the junior finance portfolio, gave the clearest signal yet that top incomes would be targeted in the December budget. He was responding to calls from some Labour TDs to raise an extra €71m a year by raising the universal social charge to 10% for people earning above €100,000.

“I think there is some room at the top to pay a little bit more — whether we would do it that way or not is another question,” Mr Hayes told Newstalk.

However, the minister admitted such a move would amount to an increase in income tax — something the Programme for Government pledges not to do.

“Everything is on the table. The dilemma for the Government is that we have clearly stated we want to keep income tax where it is,” he said. The move came as a grassroots Labour organisation urged the party’s ministers to renegotiate the Programme for Government to ease austerity and stimulate the economy.

The Campaign for Labour Policies wants a €2bn jobs package brought in. The group also called for tax hikes for top earners, insisting that “equality is not a luxury”. The group predicted it could mobilise 20,000 people to take to the streets for a protest march in Dublin on Nov 24.

Labour TDs and ministers discussed the proposal to boost the universal social charge for top earners at a meeting last week and are believed to have the support of some Fine Gael coalition colleagues as horse-trading ahead of the budget intensifies.

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