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Here's how much it would cost to get rid of the USC for incomes under €80,000

Last night the Labour party said that it will abolish charge on the first €72,000 of individual income.

Image: Shutterstock/Marian Weyo

IT’S THE MUCH-HATED tax that just won’t go away: the Universal Social Charge (USC).

Brought in by the late Finance Minister Brian Lenihan in 2011, we were assured at the height of the economic crisis that it would only be a temporary measure.

However, while Fine Gael has made promises to abolish the charge if re-elected, the party has recently been accused of ‘backtracking’ on this key issue.

Earlier this month Finance Minister Michael Noonan said that higher earners will be hit with new levies to “clawback” some of the benefits of the abolition of the USC.

Meanwhile, in a statement last night the Labour party said that it will abolish USC on the first €72,000 of individual income.

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When questioned in the Dáil about the cost of abolishing the charge on incomes below €80,000, Noonan said:

The estimated first and full year cost of increasing the USC exemption threshold from €13,000 to €80,000 is in the order of €1,584 million and €2,148 million respectively.

“This costing assumes that the current USC rates and bands as set out in Budget 2016 remain in place for those earning in excess of €80,000 per annum.

“These figures are estimates from the Revenue tax forecasting model using latest actual data for the year 2013, adjusted as necessary for income, self-employment and employment trends in the interim. They are estimated by reference to 2016 incomes and are provisional and may be revised.”

Read: Fine Gael’s promise to scrap the USC is not all it seems>

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