Tánaiste Leo Varadkar has admitted the government doesn’t know how big the bills will be – or how long the economic crisis will last.
However, we pledged a “dynamic and evolving” response to the cost-of-living crisis and listed some of the coalition’s intentions.
However, he admitted that “we don’t know what the bills are going to be” as the Labor Party has criticized the 80 cent increase in the national minimum wage, which it says would lower the living standards of the most vulnerable.
Mr Varadkar told the Dáil: “We don’t know what the bills will be. And we don’t know how much longer this will go on.”
But he warned: “The right answer is not a blank check. It is a dynamic response, responding to the evolving situation.”
Mr Varadkar confirmed that there would be a windfall tax on energy companies’ super profits in the budget, which would reflect higher earnings this year, meaning it would be retrospective in that sense.
It would budget for higher welfare payments and higher pensions, he said, as well as fuel allowance improvements that would benefit more people.
In addition, there will be a tax package, he said, to ensure work continues to pay.
“We will be able to lower your taxes and the budget will be able to increase pension and other social benefits,” Mr Varadkar said.
“We will be able to take specific actions to help people with their energy bills and all of that will be ready for the package to be announced on Budget Day.”
Referring to the utility windfall tax used to finance energy loans to individuals and businesses, he said: “It is our intention as a government, or at least we are currently considering, to introduce the windfall tax.
“We need to work out the details. But in principle the government has agreed that we will continue to pursue this.
“What we have to do is figure out how it’s going to be applied and how it’s going to work, and that’s not easy.
“But since it would apply to profits made that year, yes it would backdate to the start of the energy crisis earlier this year as profits are taxed annually.”
Mr Varadkar promised: “We will use the proceeds from this unexpected tax to help families and businesses reduce energy bills.”
Meanwhile, in the budget, Mr Varadkar has promised “the biggest income tax cut package in recent years” to be delivered in the next two weeks.
But it may never go as far as the coalition wants to go, he said after being asked by independent Sean Canney about reports cuts to the Universal Social Charge (USC) are being considered.
The tax package “will be significant,” Mr Varadkar said.
“The goal is to make sure people keep more of their own hard-earned money.”
He said the framework of the tax package has yet to be decided, “but it’s going to be part of the budget and it’s going to be part of the aid we’re going to give to people to help them with rising costs.”
https://www.independent.ie/news/we-dont-know-how-high-bills-will-go-says-tanaiste-leo-varadkar-41991582.html “We don’t know how high the bills will be,” says Tánaiste Leo Varadkar