Fiscal responsibility means targeting supports to those who need them most – Nash
Fiscal responsibility means targeting supports to those who need them most - Nash - The Labour Party
- Inflation acceleration at end of year demands that wage rises and energy and fuel supports for working families must be a priority
- Tax cuts splurge like the hospitality VAT cut, allied with major spending hikes, are incompatible and irresponsible
Labour’s Finance spokesperson Ged Nash, has said the accelerated inflation forecast for the end of 2026, puts an onus on the government to target available resources to low and middle-income households well before next winter bites.
Responding to the Spring Economic statement, he said:
“On the revenue front, Ireland’s lucky streak on corporation tax continues. Ireland’s corporation tax bonanza isn’t down the genius of FG and FF, but to decades of carefully crafted certainty in our business tax environment, regardless of the complexion of the government of the day.
“Now is the time for a government that claims to be responsible, to front up with people and to admit that tax cuts beyond indexation for PAYE workers cannot be on the table ahead of Budget 2027.
“Instead, resources need to be focused in a laser-like way on targeted energy credits, fuel supports, accessible retrofitting and forms of grant aid to some firms as things are likely to worsen as a result of this energy shock and global volatility. This would make the country better prepared than it currently is, for an uncertain future over which we have little control.
“There was never a case for the economically stupid and expensive hospitality VAT cut for a sector that is adding jobs. This cut is due to come in in July and has a full year cost of close to €700million, paid for by PAYE workers who are only seeing prices rise. The Tanaiste should take advice, and show that he is capable of the leadership and courage needed to review this wrong-headed move.
“That case diminished further when at least €1.5billion will need to be found for next year to give some necessary tax relief for working families to make some amends for FG’s failure to index bands and rates for 2026.
“The Spring Statement makes it clear too that the general inflation we will see this year – even if the more benign scenario plays out – will mean those with the least will be hardest hit as they spend a higher portion of their income on food, groceries, heating and transport.
“This needs to be focus above all else, and any intervention government makes in the economy needs to be measured, responsible and targeted and cannot allow an already troubling inflation scenario to become any worse than it already is.”