MANDATE ANGRY AT EMERGENCY BUDGET WHICH TARGETS LOW PAID AND VULNERABLE IN SOCIETY

Mandate General Secretary, John Douglas said, “Thousands of workers have lost their jobs in the past twelve months and this budget didn’t show any real effort in stimulating employment. At the same time it didn’t do enough to tax high earners and tax exiles while targeting middle and low income earners. There was ineffective provision for retraining of those who have lost their jobs and also a lack of stimulus for retail employment generally.”

Mandate is further concerned by the blunt instrument of the income levy that is being imposed. Rather than using the sophisticated PAYE system which has protections in place for workers and their families, affording them some certainty in their standards of living, the income levy takes no account of these protections.

Mr Douglas said, “The shocking extension of the income levy to low earners including those earning below the minimum wage of just over €17,000 per year is a totally unacceptable and disproportionate attack on the poorest in our society.

“For example, workers earning just over €15,000 per year, which is less than half the average industrial wage or approximately one twelfth of a Government minister’s salary, will now pay a 2% income levy. If you include the new rate included in the PRSI health levy which has been doubled to 4%, these people will now pay up to 6% of their income in taxes.

“The minimum wage was implemented as recognition that this is the minimum a worker needs to earn in order to survive, so using levies as a means to tax is both cunning and unfair. Mr Lenihan spoke of fairness in his budget speech yet he has decided to tax low earners while at the same time refusing to increase significantly the tax burden on the disproportionally rich. Those words of fairness and equity appear to be empty words and promises.

Also of concern to Mandate is the disgraceful cutting of social welfare rates for young people under the age of twenty to half of what everybody else is entitled to.

Mr Douglas said, “This is quite clearly an ageist decision and if it was targeted at any other sector of society we would see massive vocal opposition and disgust. It will also put a huge amount of pressure on families because as we all know, a large proportion of young unemployed people still live at home. This means that a lot of mothers and fathers will now have to cover the cost of their unemployed children despite seeing a massive decrease in incomes themselves. There is also the possibility that one or both parents may have already lost their jobs in recent months making life incredibly difficult for some families.

The budget shows no investment in social, community and business projects that protect the jobs we have and create new opportunities for more jobs. If Government genuinely wanted to stimulate growth and spending they could have dropped the VAT rate. This would increase spending which in turn would not only protect jobs, particularly in the retail sector, but it would also serve to create more employment and lower the levels of unemployed.

Mandate will, over the coming months continue to campaign, through partnership and other means, for the abolition of the income levy and the use of the income tax system as the primary method for taxing workers. This is the only fair and equitable system for all workers and will provide for the protection of low paid workers.

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