S queezed middle left to shoulder tax burden

THE squeezed middle is in danger of becoming mangled as the Government persists in going for the soft target.

According to the latest figures, workers are now paying €5bn a year extra in tax since the boom. Dermot O’Leary of Goodbody’s is in no doubt that the Revenue figures prove that ordinary workers have been hit hardest.

Einstein believed that his income tax return was far too difficult a matter for himself – a mere mathematician – and would be better taken care of by a philosopher. If you are a middle-income earner in Ireland, you would certainly take your chances with the philosophers.

Mr O’Leary also points out that, as employment is currently 7pc below the levels of 2007, the vice in which workers are trapped is being tightened relentlessly to yield even more tax. Thus we have arrived at a juncture where income tax and USC are the largest sources of tax revenue to the State.

Last week the IMF stated bluntly that Ireland’s income tax system was hurting middle-income earners. People struggling to pay mortgages, rents, or childcare hardly needed the IMF to tell them they are being put through the wringer.

The system needs to be radically reformed. We know to our cost that it creates welfare traps and locks women out of the jobs market. People have been compliant on the basis that it was in the best interests of the country to be so.

Everyone has a breaking point, especially when overextended. But being stoic or being stupid probably depends on whether one is being treated equitably or not. Being left to shoulder an unfair burden when there are other options is simply unjust. As the October Budget looms, Finance Minister Michael Noonan, had better take note.