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No increase in income tax planned, says finance minister

Paschal Donohoe was speaking about what the upcoming Budget might look like.

The finance minister said that tax receipts are
The finance minister said that tax receipts are "holding up quite well".
Image: Sam Boal/RollingNews.ie

FINANCE MINISTER PASCHAL Donohoe said there will be no increase in income tax in October’s budget.

Donohoe said that personal tax receipts are “holding up quite well”.

He added that September’s tax returns will be the final “piece in the jigsaw” before the government decides on next year’s budget.

Donohoe said, however, that he has no plans to go to government to increase income tax.

“Our personal tax receipts are holding up quite well, and in terms of what that says about our economy, it does indicate to me that momentum is building in our economy,” he added.

“In terms of the Budget 2021, September is always a significant month in terms of tax receipts and it’s the final piece in the jigsaw before we make a call about what our tax collection will be for the year and the following year’s budget.

“Even at this point I will have to see how the month’s worth of tax collection to form a view regarding the trend that we are seeing at the moment is one that is sustainable across the year and will carry into next year.”

Stay and spend

Donohoe was speaking at the launch of the new Stay and Spend scheme aimed at customers to help boost sales in the hospitality sector which has been impacted by the Covid-19 pandemic.

The scheme will provide a maximum of €125 in income tax credits to taxpayers who spend up to €625 in restaurants, pubs, hotels, B&Bs and other qualifying businesses.

It will run from autumn of this year to spring of next year and includes the Christmas period.

The scheme is expected to cost over €200 million

Taoiseach Micheal Martin said: “We are preparing a new overall plan in terms of managing Covid-19 right through to the end of the year and beyond in terms of how we live with Covid-19 and how we protect lives and livelihoods and that will focus on all sectors.

“We hope to have that plan by the middle of September which will outline the road map.

“This is all about making it cheaper for our citizens to spend more.”

Speaking about the reopening of pubs, Martin said: “At the moment guidance is being worked with the public health authorities in relation to conditions that would apply in the event of pubs reopening.

“We would love to see pubs reopen as we understand the disappointment across the country and the financial wellbeing and the emotional wellbeing, so that is our objective and we want crowds back at sporting events.

“I would love to go back and see a championship match. All of that will be dealt with in the middle of September.”

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Commissioner candidates

Martin also said the names of two “strong” candidates will be sent to the president of the European Commission Ursula von der Leyen for the role of commissioner in the coming days.

He denied claims that recent events had damaged the relationship between Ireland and the European Commission.

“It hasn’t damaged our national standing at all, that’s not the case and in terms of the allocation of the portfolio that’s a matter for the president of the commission,” Martin added.

“I’ve had good discussions with the president of the commission and I am not going to pre-empt her decision.”

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