Politics

Labour to abolish USC on all incomes up to €72,000

Party launches economic plan, includes increased tobacco excise and sugar tax

Labour leader Joan Burton with Alan Kelly and Brendan Howlin during the formal launch of the Labour Party General Election campaign. Photograph: Brenda Fitzsimons/The Irish Times
Labour leader Joan Burton with Alan Kelly and Brendan Howlin during the formal launch of the Labour Party General Election campaign. Photograph: Brenda Fitzsimons/The Irish Times
Sarah Bardon
Mon Feb 08 2016 - 11:57

Labour will abolish Universal Social Charge on all incomes up to €72,000 and clawback the benefit from those earning over €100,000.

The party launched its economic plan confirming it will increase the bank levy, introduce a sugar tax and increase excise duties on tobacco.

USC will be abolished on the first € 72,000 of income over the next five years.

Minister for Public Expenditure and Reform Brendan Howlin said the benefit will be frozen on incomes between that level and €100,000.

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He said: “The USC is an onerous tax on people on low to middle income earners. It is a burden on workers.”

The party said those on € 25,000 will benefit by € 44 a year, those on € 50,000 will benefit by € 44 a year while those on €120,000 will pay the same tax.

Tánaiste Joan Burton said this was an example of the party protecting low and middle income earners.

She said: “That is progressive. That is fair. We’ll ensure that they will be gradually freed of this penal tax.

“At the same time we’ll ensure the wealthiest in society continue to pay for their fair share. That will ensure resources are available for investment in essential services such as schools, childcare and healthcare.”

The party is also proposing additional relief at low and middle income working people earning between €18,305 and €36,608.

Mr Howlin said that would be something that could be negotiated in the programme for government discussions with their coalition colleagues.

Ms Burton also called for Sinn Féin to outline their economic proposals alleging the party is ducking and diving from revealing the contents of their plan.