Call to tax rich more to help poorest

High-earners should be taxed more to allow for a hike in welfare payments for low-income families, it was claimed today.

The Combat Poverty Agency said it would be calling on the Government to review tax-relief schemes, including mortgage and pension, in this year’s budget.

Launching its annual report the body said the State must remain committed to eradicating poverty by 2016 despite the financial pressures caused by the economic downturn.

Kevin O’Kelly, Combat Poverty acting director, said the agency would be putting forward a number of options at this year’s budget to ensure low-income families struggling with the credit crunch receive proper financial support.

“It will include increases in taxation, we feel that has to be looked at by the Government.

“We would be very much opposed to increases in any indirect taxation because that hits low-income families disproportionately, but we’d be making proposals around increases on the higher rate of income tax, in looking at tax reliefs that are there at the moment,” he said.

“There’s a whole range of reliefs, mortgage relief, pension relief, business start-ups, building, developments.

“We’re not saying they should be done away with but they should be maybe examined or reduced.”

Mr O’Kelly said last year the Government cut the top-rate of income tax from 42% to 41% and index-linked the tax bands, moves which cost the Revenue around €500m.

“If you look at that analysis we feel that these things need to be examined,” he added.

“It is a political decision in the end, but we feel there’s scope there to meet some of the demands that are required.”

The Combat Poverty Agency said the economic downturn will make the Government’s target of eradicating poverty by 2016 more difficult to achieve.

It urged all State bodies at local and national level to rally together to tackle the issue.

Latest figures put the poverty level in this country at 6.9% and the State is committed to cutting that to between 2% and 4% by 2012, and wiping it out by 2016.

Brian Duncan, Agency chairperson, said the current economic downturn would make it easy for the Government to falter on these targets but it was vital for the State not to lose focus.

“Central to ending poverty will be a consistent and coherent drive across all State institutions, ranging from national policies to their implementation at a local level, to deliver policies and achieve interim targets,” he said.

“Tackling poverty and social exclusion needs to be at the heart of policies on employment, education, and training, health and housing.

“Current pressures points such as health inequalities, as well as food and fuel inflation, need to be addressed before they become very problematic.”

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