Taoiseach Bertie Ahern has pledged to double the home carer's allowance from 770 to 1540 a week if re-elected. Mr Ahern made the promise in the course of his pre-election Fianna Fail Ard Fheis speech last Saturday. Fianna Fail are now the fourth party pledged to increasing the home carers allowance.
Fine Gael, Labour and the Green Party have already committed to increasing the home carers allowance, a welfare allowance given to a full time carer in the home, by 1000 euro. The Home Carer Credit was introduced as a result of the controversy caused by tax individualisation in 1999. The Credit applies to all married one-income couples and is aimed at the spouse who works in the home caring for a child or other dependent. The Credit is worth €770 pa and has not been increased since Budget 2000.
Tax individualisation is a policy which seeks to create a family taxation regime in which tax is based on the individual earner and takes no account of whether the tax-payer has dependents.
The latest move comes after the Iona Institute highlighted the growing gap between the amount of tax paid by double income and single income married couples on the same income. In their first policy document, “Tax individualisation: Time for a Critical Rethink,” launched by Labour Finance Spokesperson Joan Burton TD, they showed that the gap between both types of couples can be up to €6240. There are 307,000 one-income married couples in the country.
In a statement, John P. Byrne BL, the author of the document, welcomed the proposals made by all four political parties. The new policies, he said, were improvements on the approach formerly taken by the Government since they did not “widen the gap between married one-income and married two-income families and sought to significantly raise the Home Carers Credit”.
However Mr Byrne added that the policies did not address the current difference on tax bands between one-income and two-income married couples. As such, he said, the policies of all the parties “did not go far enough”.
Tom O’Gorman of The Iona Institute stated: “It’s about time the political establishment woke up to the injustice created by tax individualisation. This directly discriminates against spouses who choose to stay at home and look after a dependent rather than take up paid employment. The tax gap introduced by Charlie McCreevy in Budget 2000 has actually been doubled in subsequent budgets. The Government shouldn’t favour one income married couples over two income married couples, or vice versa. What the various parties are now proposing is a first step in the right direction and we welcome that.”
27/03/07
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