THE EXCHEQUER could collect at least €2 billion more in taxes if all tax relief schemes were available only at the standard rate, the justice committee of the Conference of Religious in Ireland (Cori) has said.
In a pre-budget briefing, the Catholic church organisation said yesterday it was unfair that people on lower incomes could only claim tax relief at 20 per cent, while those on higher incomes benefited from relief at a rate of 41 per cent.
The group has also called for an increase in social welfare payments of at least €9.90 a week.
Fr Seán Healy SMA, director of Cori Justice, said the Government should give priority to initiatives that are good for the vulnerable and good for the economy.
He said it was profoundly unfair that a person on a lower income has to pay substantially more for a treatment compared with a person on twice that income.
Dental treatment worth €1,000 costs a person on a lower income €800 after tax relief, he said, while a person on a higher income pays €590 net. Other schemes involving tax relief such as pensions and medical expenses also benefited the better paid.
"If there is a legitimate case for making tax relief/expenditure available then it should be made available in the same way to all," he said.
He said the exchequer could collect at least an additional €2 billion in revenue if all tax relief schemes were available only at the standard rate.
Cori also said the Government should not widen tax bands in the budget, but if money was available for adjustments, should increase tax credits, so that any change benefited the lower paid. For those on the lowest pay, tax credits should be refundable so that they receive the benefit of any budget adjustments.
"This would also address the disincentives currently associated with low-paid employment," Fr Healy said.
Budget 2009 should increase the minimum social welfare payment by €9.90 a week, bringing it up to €203.75 weekly, Cori suggested.
Cori also called on the Government to stick to its commitments on social housing made under the national partnership agreement, Towards 2016. There are 44,000 households on local authority housing lists in Ireland. Providing the promised 27,000 units by the end of 2009 would be good for the economy as well as the vulnerable, Fr Healy said.
Couples getting social welfare payments who live together get a smaller amount than those living apart, Cori pointed out, receiving €329.10 a week compared with those not together who get €395.60.
Cori said that though recent budgets had gone some way towards addressing the issue, the system was still unfair and inequitable.
There should also be significant increases in the level and availability of fuel allowances to address the sharp increase in fuel prices, Cori said.
