ICTU calls for new higher tax rate

The Irish Congress of Trade Unions has called for a new tax rate for the wealthy of over 54%.

Speaking at the launch of its economic strategy document 'A 10 point plan for a Better Fairer Way', ICTU general secretary David Begg said that the new rate would have to be above the highest rate which currently exists of the top income tax rate and levies combined.

He said the most important thing is that there should be a clear demonstration that the people best able to contribute to the current adjustment should be seen to do so. Mr Begg said he was not talking about a 90% surtax, but he reckoned it would have to be above 54%.

The ICTU plan launched today is an updated alternative strategy to restore the public finances to health.

Congress says its '10-Point Plan for a Better Fairer Way' prioritises the protection of the vulnerable through an integrated recovery plan. It says the Government can afford to increase borrowing to accommodate this.

It rules out reductions in social welfare, and believes pay cuts are counter-productive because they will trigger a deflationary spiral.

ICTU wants a €1 billion jobs promotion fund, and proposes a national recovery bond to fund infrastructure and stimulate employment.

ICTU wants to assist those at risk of losing their homes by establishing an office of indebtedness as an alternative to court procedures - with a three-year protection period during which there would be no repossessions.

Congress also wants Government action to tackle the pensions crisis, reform of the banking system, and legislation enacted to enhance workers rights.

ICTU acknowledges that its alternative will not prevent pain and hardship, but says its approach is better and fairer.

Unions are trying to promote their alternative strategy ahead of what is expected to be an extremely tough budget on December 9. The Government has already signalled that it intends to cut €4 billion from public spending next year, with €1.3 billion coming from public sector pay.