5% corporation tax rise would not hit our competitiveness
Sinn Féin makes no apologies for our position in relation to corporation tax. In common with others, including the ESRI, Sinn Féin is of the view that an increase of 5% in corporation tax would not damage the competitiveness of the State.
The increase which SF is proposing would be part of a much needed wider reform of the tax system, the objective of which would be the creation of a progressive and egalitarian system to enable the State to deliver the infrastructure and social spending which will ultimately have a beneficial impact for business.
Mr Carey seems to forget that corporation tax is not a punitive charge on business - it is a mechanism by which business pays for the services provided by the State which enhance the business environment.
Mr Carey also ignores the downside of such low rates of corporation tax.
A recent study by the Combat Poverty Agency found that social spending fell from 21% of GDP in 1992 to 14% in 2001, that social spending per head is 61% of the EU average.
This reduction came about in parallel with the decrease in corporation tax rates.
Mr Carey also ignores the fact that low corporation tax is subsidised by high taxes on spending (VAT, excise duties) which are regressive because they hit hardest low-income families who consume a larger proportion of their income.
Irish workers will benefit from the creation of a progressive and reformed tax system, underpinned by the objective of wealth redistribution.
Our proposals to adjust the corporation tax rate is a central part of this strategy.
Mr Carey’s time would be better spent seeking to redress the fact that his party’s policies have ‘surrendered’ workers to exploitation, displacement and a race to the bottom in terms of wages and conditions of employment.
Arthur Morgan TD
Sinn Féin spokesperson on Enterprise and Employment
Leinster House
Kildare Street
Dublin 2
