Minister admits USC causing hardship
He also insisted TDs were not overpaid as they did a “temporary” job.
The minister of state at the Department of Finance denied widespread reports of a rift in the Coalition with Labour seeking to use improving economic conditions to reduce USC, while Taoiseach Enda Kenny looking to prioritise cutting the top rate of tax.
Referring to the USC, Mr Harris told the Irish Examiner: “I have mixed views on it, I think the USC at the current rate of 7% is causing significant hardship for many people and I would personally like to see that rate reduced over time.”
Mr Harris said it could be possible to move on both USC and the top rate of tax.
“A simple tax system is best. Is there an argument for looking at the overall tax burden, merging it into one tax ultimately at a reduced rate? I think that’s a compelling case,” he said.
In what was seen as a swipe against Labour TDs demanding the Government targets USC first, Mr Harris insisted Labour signed up to the current economic plan when Joan Burton took over as Tánaiste.
“The Taoiseach and Tánaiste agreed a joint statement of priorities. This isn’t being made up on the hoof. I don’t think there is a conflict because in this budget we have done both — it’s a Cabinet budget.”
Figures from the Department of Finance show the State would lose out on at least €1.6bn in revenue if it scrapped the USC for those earning €60,000 a year or less.
Meanwhile, Mr Harris said he did not think TDs were overpaid as they had taken a cut in wages to €87,258, and did a “temporary” job.
“I think it will always be an issue debated and it is important we took a pay cut in Haddington Road.
“You can have a populist discussion about this, I’ve no difficulty with any pay cuts that people have been asked to take in the public sector.
“It’s linked to public service pay, so that’s fine, without having the benefits of permanency,” the Minister of State said.
The Minister insisted Fine Gael had a good record on parliamentary spending as they had reduced the number of TDs at the next election and implemented pay cuts for Oireachtas members.
USC rates are believed by Labour to be one of the key reasons for its dramatic slump in the polls, while Mr Kenny has consistently stressed the need to raise entry levels to the top rate of income tax for lower and middle earners.
Mr Harris also backed calls for Spring statement to set out the Government’s economic plans in more detail.
