FORMER TAOISEACH Garret FitzGerald has called for cross-party agreement on the introduction of an emergency mini-budget “as soon as possible” to bring in extra revenue, particularly by increasing income taxes for middle-income earners and imposing a property tax.
“We need a budget that will bring in additional tax revenue; we need an early, interim budget,” he said.
In an interview on RTÉ Radio One’s Morning Ireland, Dr FitzGerald said the Government needed the support of the Opposition to get the “courage” needed to increase tax revenues.
“And the Government has begun to recognise the need for more tax revenue.
“They denied that up to the end of December. In January the Minister for Finance began to face up to it. Then about 10 days ago the Taoiseach, in his address to the Engineers’ Association, also came round to recognising that.
“But no action has been taken on it; they’re still talking of leaving it over until the Commission on Taxation reports in the autumn: no sense of urgency.”
He said the Opposition was very careful to say nothing about tax as “they want to avoid the issue”.
Later yesterday, Fine Gael leader Enda Kenny issued a statement in which he called for a new budget to raise taxes.
Dr FitzGerald said the two sides had to get together to agree on the need for a budget and the requirement for substantial tax increases to replace lost revenue.
“You cannot run the country if your revenue disappears and you don’t replace it.”
Asked if he wanted an immediate mini-budget to be brought in, he replied: “Yes, as soon as possible. It may take a few weeks to put it together but certainly within a month or so we should have a mini-budget, and that should be supported by the Opposition.”
Asked if he was saying that the Opposition parties should join forces with the Government to form a government of national unity, the former taoiseach said: “No, I would avoid that as long as possible, if it is possible to avoid it, because it is very important that a government should face an opposition, a critical opposition, and many of the criticisms and suggestions the Opposition have made here have been very constructive and useful.
“To have no opposition would, I think, be a great mistake at this stage, if we could avoid it.
“So what we need is agreement on taxation between the Government and Opposition and the Opposition, whoever they would be, would be continuing to make criticisms and suggestions on other issues. But the Government clearly seems to be afraid of doing anything about the need for tax revenue, though they have made it publicly clear they recognise the need for it.
“And the Opposition are not prepared to mention it. In the meantime the country is drifting on in an impossible situation with a huge gap in borrowing which is, in fact, growing all the time and getting more and more out of control.”
Asked if what he was suggesting was a 2009 version of the Tallaght Strategy in which then Fine Gael leader Alan Dukes decided not to oppose necessary cuts in government spending, Dr FitzGerald replied: “We’re talking about a budget, an interim budget to be brought in as we did after we came into government in 1981. I’m not sure we got much support for that at the time. In this case you would need to have the support of the Opposition.
“The Government clearly are reluctant to get into this before the local and European elections – into the tax issue – in the absence of support from the Opposition.
“The Opposition are prepared to avoid this subject till they get through the election. Everything is to be dominated by elections; what should be dominating today should be saving the country.”
