Tax incentives - Equity must be restored

ENCOURAGING investment will be a vital part of getting our economy back on its feet but that is no reason to tolerate blatant injustices in our tax system.

Over 400 of the country’s richest people cut their 2007 tax liabilities by utilising almost €290m in tax breaks. Of 439 individuals involved, 214 earned €500,000 or more while 225 earned up to €500,000.

The figures show that the 439 claimed just under €290m in tax breaks. This brought their effective tax rate under that of many workers.

The 214 earning €500,000 or more paid an average effective tax rate of just 20.08%. A single PAYE worker paid 20% on the first €34,000 and 41% on the balance.

The Commission on Taxation report has been completed and it must be hoped that it has found a way to encourage investment but at the same time ensuring that everyone earning above a certain level pays a minimum amount of tax no matter what investments they involve themselves in.