ISME calls on Govt to reassess income levy proposal
ISME, (Irish Small & Medium Enterprises Association), has called into question the methodology used in the Government's decision not to apply the income levy on those on a minimum wage.
In a statement released this evening, ISME made the point that those paid above the minimum wage will be hit for the full levy which in turn will lead to a significant disincentive for those on the minimum wage to work overtime.
ISME Chief Executive, Mark Fielding said: “In attempting to save their bacon after the fiasco of the medical cards, the Government have somehow managed to get it wrong again by introducing a levy system that disincentivises those on the minimum wage to work overtime when they will be levied on the full amount. For example an employee on €17,500 is exempt from the levy, but if they earn €1 more the levy is applied to all earnings, incurring an immediate liability of €175.
"In other words to earn €1 more would cost someone 175 times that amount. This is a ridiculous situation and a hair brained proposal, which was only brought in to appease the Unions but has the affect of disincentivising work", he added.
