Commission on Taxation recommendations

An RTÉ report outlines the recommendations from Ireland’s Commission on Taxation report. [pdf file] Opposition parties, and other interested groups, are reportedly wary. Adds According to Taoiseach Brian Cowen, the report “is setting a framework for reforms over the next decade.”From the RTÉ report

Outline of proposals

An annual property tax on all residential property excluding social and local authority housing

– Child benefit should be a taxable income with a tax credit to offset the increase in tax for low income earners

– A new three-rate income tax system should be introduced to replace the current high and low income tax rates

– The health levy should be abolished and integrated into income tax system when fiscal conditions improve

– Rules on residency and tax exemption should be strengthened

– Stamp duty on ATM, credit and debit cards should be phased out in the interest of promoting cash free society

– Removal of tax relief for nursing home expenses once the Fair Deal scheme ends

– The current ‘Cinderella clause’ needs to be supplemented with additional tests and criteria

– Additional capital gains tax should apply on windfall gains from property rezoning

– Domestic water charges should be phased in, with incentives to install meters, with a waiver for low income households

– Carbon tax based in tonnes of carbon should be introduced and collected at earliest point of supply

– VRT should be replaced over ten years by a system based on car usage

– Tax relief for pension payments should be replaced with a scheme ‘along the lines of the former SSIA scheme’

– The first €200,000 of pension lump sums should be tax-free with remainder taxed at standard rate

– Ireland’s low corporate tax rate should remain in place to support economic activity long term

– End to the artists’ tax exemption

– Expenses of Oireachtas members should be treated as the same way as expenses paid to all other employees, with a limit placed on the dual abode allowance and an end to the flat rate of relief for accommodation.

– End stock relief for farming business but continue relief on farm land leasing

– Income tax relief for trade union subscriptions should be ended

Pete Baker