Irish Taoiseach Leo Varadkar has defended his proposals to cut income tax, claiming Ireland’s current regime acts as a disincentive to people entering the workforce.
“The fact that our higher rate of income tax in Ireland kicks in so soon is a disincentive," he said. “It’s not just the unfairness of taking so much money out of people’s pockets. It’s also the fact that when we’re competing for jobs with the United Kingdom and competing for talent and investment, we put ourselves at a disadvantage by having a higher income tax rate that kicks in below average incomes.”
To make matters worse, the Employment Bill currently going through the Oireachtas is inherently anti-business, a hotels industry body has claimed. The Cork branch of the Irish Hotels Federation (IHF) said the current form of the Employment (Miscellaneous Provisions) Bill 2017 would drive up costs for employers and have a negative impact on the tourism industry.
Under the Bill, employers must provide employees with basic terms of employment within five days. Zero-hour contracts are also prohibited except in situations of genuine casual employment. The Bill also offers a new minimum payment for employees if they are called in to work but sent home again without work, providing more certainty to so-called ‘banded hour workers’ in relation to their working hours and income.
Cork IHF branch chair Neil Grant told the Irish Independent: “Nobody objects to banning zero-hour contracts, which are almost non-existent in Ireland, but legislation which reduces labour market flexibility, under criminal sanction for employers, will drive up costs beyond inflation."
Meanwhile, the Irish Congress of Trades Unions (ICTU) has warned that people already saving for retirement will lose out if existing pensions tax relief is scrapped as part of a planned shift to auto-enrolment.
It told the Irish Sun that it fears Irish workers paying higher rates of income tax on pensions would be disadvantaged by the move as auto-enrolment is expected to cut the amount of tax relief that can be claimed by employees already with a pension.
The ICTU suggested that the State would contribute €1 (US$1.15) for every €3 (US$3.41) contributed by an individual. This effectively amounts to tax relief of 25%, even if workers are paying income tax at 40%.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
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Irish Taoiseach Leo Varadkar has defended his proposals to cut income tax, claiming Ireland’s current regime acts as a disincentive to people entering the workforce.
“The fact that our higher rate of income tax in Ireland kicks in so soon is a disincentive," he said. “It’s not just the unfairness of taking so much money out of people’s pockets. It’s also the fact that when we’re competing for jobs with the United Kingdom and competing for talent and investment, we put ourselves at a disadvantage by having a higher income tax rate that kicks in below average incomes.”
To make matters worse, the Employment Bill currently going through the Oireachtas is inherently anti-business, a hotels industry body has claimed. The Cork branch of the Irish Hotels Federation (IHF) said the current form of the Employment (Miscellaneous Provisions) Bill 2017 would drive up costs for employers and have a negative impact on the tourism industry.
Under the Bill, employers must provide employees with basic terms of employment within five days. Zero-hour contracts are also prohibited except in situations of genuine casual employment. The Bill also offers a new minimum payment for employees if they are called in to work but sent home again without work, providing more certainty to so-called ‘banded hour workers’ in relation to their working hours and income.
Cork IHF branch chair Neil Grant told the Irish Independent: “Nobody objects to banning zero-hour contracts, which are almost non-existent in Ireland, but legislation which reduces labour market flexibility, under criminal sanction for employers, will drive up costs beyond inflation."
Meanwhile, the Irish Congress of Trades Unions (ICTU) has warned that people already saving for retirement will lose out if existing pensions tax relief is scrapped as part of a planned shift to auto-enrolment.
It told the Irish Sun that it fears Irish workers paying higher rates of income tax on pensions would be disadvantaged by the move as auto-enrolment is expected to cut the amount of tax relief that can be claimed by employees already with a pension.
The ICTU suggested that the State would contribute €1 (US$1.15) for every €3 (US$3.41) contributed by an individual. This effectively amounts to tax relief of 25%, even if workers are paying income tax at 40%.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
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