Tánaiste Michael McDowell yesterday announced plans to reduce the burden of stamp duty on all housebuyers if the Progressive Democrats are returned to Government.
The party also committed itself to cut the two rates of income tax, widen the bands, increase the old age pension by €100 a week and spend more on childcare.
Winding up the PD national conference in Wexford, Mr McDowell said the party had decided to abolish stamp duty for first-time housebuyers and to make it fairer for all purchasers. This will be done by "banding" the rates so that people only pay the higher rate on the portion of the price over each threshold.
The PDs also made commitments to introduce a new SSIA-type scheme for pensions and to double the early childcare supplement to €2,000 as well as increasing the old age pension to €300 a week.
The cost of all the commitments made at the weekend comes to some €4.5 billion, but Mr McDowell maintained that the measures were fully costed and would remain within strict fiscal limits.
"It is affordable because if there were no significant tax changes over the lifetime of the next government, the State would collect €6.2 billion more than it needs by 2012," he said.
Responding to the PD commitments, Taoiseach Bertie Ahern said he saw the benefit in a lot of the tax proposals announced by the party.
He added the Government was committed to a low tax regime and that it was what they had been working towards for the past few years.
Mr McDowell denied that the PD tax package represented auction politics, as the party had always favoured reducing the tax burden on individuals. He described its commitment to lower taxes as a "core value" of the party.
The key tax commitments made by the PDs are to reduce the higher rate to 38 per cent and the lower rate to 18 per cent during the lifetime of the next Government.
"We will also adjust the tax bands so that a couple, both earning, can earn at least €100,000 and only pay income tax at the standard rate. This would mean that a single worker could earn €50,000 and only pay income tax at the standard rate.
"We will also increase tax credits so that couples earning up to €40,000 will pay no income tax. This would mean that a single worker could earn €20,000 and pay no income tax," said Mr McDowell.
The SSIA-type scheme for pensions being proposed by the party will involve the State contributing €1 for every €2 saved, and it is aimed at those on lower and middle incomes who pay tax at the standard rate.
Mr McDowell also said yesterday that he would have no problem doing a coalition deal with Fine Gael but, he said, Fine Gael had made it clear they would prefer to do a deal with the Greens rather than the PDs.
Labour leader Pat Rabbitte claimed it was significant that there had been no indication from Fianna Fáil as to whether or not the party endorsed Mr McDowell's proposals. He also said that the PD plans would help the better-off.
"Reports that Mr McDowell had originally planned to announce a cut in the top rate only, and the commitment to reduce the lower rate was only added on in response to my initiative last weekend, come as no surprise given his over-the-top reaction to the Labour conference.
"A tax benefit targeted mainly on those on lower and middle incomes by the Labour Party is, according to Minister McDowell, auction politics; a tax benefit targeted at higher earners by the PDs is conviction politics," said Mr Rabbitte.
A spokeswoman for Fine Gael said the tax promises outlined by Mr McDowell "smacked of desperation".
