Leo wants to help out the ‘squeezed middle’ in Budget

‘A little bit in everyone’s pocket’

ANY revenue raising measures in the next Budget will go towards reducing income taxes for the ‘squeezed middle’, Taoiseach Leo Varadkar has said.

Mr Varadkar said he wanted to ensure there is a tax and welfare package that ‘puts a little bit of money into everyone’s pocket’.

While the first priorities will be to balance the books and increase public spending, the Taoiseach wants to take middle income earners out of the higher tax bracket.

Speaking at the Virginia Agriculture Show in Co. Cavan yesterday, he said: ‘Last year we did have some revenue raising measures. We raised the commercial stamp duty in order to move the market towards building houses and we see some of that now taking effect, a 30% increase in the number of new homes built compared to this time last year.’

‘We also had the sugar tax for public health reasons. So if we do have any revenue increasing measures in the next budget, they will be done for good public policy reasons.’

He added: ‘That money would then be used to reduce other taxes, particularly... on income.

‘As you know we’ve taken the vast majority of low paid workers out of the income tax net altogether in the last couple of years, and we want to now focus on middle income taxpayers, making sure they don’t pay the highest rate of income tax, as they do now on very modest incomes.’

Currently, the 40% higher rate of income tax kicks in for workers earning €34,550 or more.

But recent reports have suggested the Government is also considering an increase to PRSI that would hit middle income earners by up to €250 a year.

Mr Varadkar said: ‘It’s never going to be possible to do everything that everyone wants us to do in one year, there is only a certain amount of money.

‘If we are heading into any economic turmoil in the years ahead because of Brexit or anything else, the best way to prepare for that is to make sure that our public finances are in order.’

He also revealed that the muchmaligned ‘granny grant’ proposed by Transport Minister Shane Ross is ‘under consideration’.

‘I’ll be very much listening to Minister Zappone in relation to what she thinks would be the best way to prioritise spending on childcare,’ he said.

Mr Ross drew a lot of criticism for his proposal to offer a €1,000 bursary for grandparents taking over childcare duties for their grandchildren.

Children’s Minister Katherine Zappone is believed to strongly oppose Mr Ross’s proposals.