Employers in Ireland pay about half the amount that their peers in other wealthy European countries when it comes to taxes on labour, trade unions have said.
In a report published on Thursday, the Irish Congress of Trade Unions (Ictu) criticised complaints from employers about the cost of Government reforms aimed at benefiting workers.
It says the “false perspective” about the rising costs of doing business articulated by many business groups had “become the accepted truth in many quarters”. Discussion on this issue has to be based on reality and not fantasy, it says.
Ictu general secretary Owen Reidy said businesses had received additional State supports for nearly a decade due to Brexit, Covid-19, the war in Ukraine and the cost-of-living crisis.
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“The trade union movement supported some of these measures as they related to specific external shocks/factors. But it seems some business groups expect unique and additional supports for specific factors to be mainstreamed and to become the norm,” he said.
Ictu said the Government had introduced or was planning to put in place measures such as a higher minimum wage, a statutory sick pay scheme, pension auto-enrolment, parental and domestic violence leave as well as the right to request remote working.
The trade union movement said it welcomed “the direction of travel of these reforms both individually and collectively”. It said that in many cases the reforms “will merely bring us closer into line with pre-existing norms and practices in most other western European countries”.
It said the Government’s measures were being introduced gradually and at a time of notable economic strength.
“For example, the transition to the higher minimum wage is taking place over a four-year period while the auto enrolment scheme is being phased in over a 10-year period and represents a long-standing and long-flagged commitment of Government.”
Ictu says the proposed reforms have been criticised by some within the business community who cite the cumulative cost to companies and the speed at which they are being introduced.
“Requests by business lobbies for PRSI rebates and reductions should be seen in their proper context. Irish firms already pay much less than their EU counterparts when it comes to employer PRSI (about half of what their counterparts pay as a portion of national income) and so are already effectively being subsidised by the rest of society.
“Calls for preferential tax treatment in the form of reduced VAT rates make little economic sense and the economic development argument for disproportionately benefiting low value-added sectors is very weak if not actually counterproductive in the long-run.”
Mr Reidy said that despite the warnings of some employers about the threat to jobs, “we actually have a record number of workers at work – 2.7 million”. He also said that some of the sectors “shouting the loudest such as hospitality and retail have seen real employment growth in the last year”.
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