Minister for Finance Paschal Donohoe earlier today claimed that he had “never said the USC was temporary. That’s never a point I’ve made.” The Minister went on to say that “I’ve always said that to remove the USC…isn’t a feasible prospect.”
The Minister’s statements are unfortunately simply not true. Whilst it is correct to say that, in the past number of years, Minister Donohoe has been circumspect as to the permanency of the USC, he has previously made multiple statements calling for the abolishment of the USC and he has previously referred to USC as a “hated, emergency measure.”
FF introduced the hated, emergency measure USC. @FineGael will abolish it. Don't let FF put recovery at risk #GE16 pic.twitter.com/iLrF9oIFPu
— Paschal Donohoe (@Paschald) February 19, 2016
The Minister went so far as sharing a link to an online calculator which he said showed “how abolishing USC will benefit every worker.”
Check out @FineGael's Income Calculator showing how abolishing USC will benefit every worker https://t.co/H8UUzS4aL9 pic.twitter.com/I7PqbZsw6X
— Paschal Donohoe (@Paschald) February 18, 2016
These comments date to the period around the 2016 election, in which Fine Gael relied heavily on a promise to abolish the USC by 2021. Then-Finance Minister Michael Noonan was reported, by the Irish Independent, to have said that abolishing the USC was “the number one commitment” that Fine Gael would make to voters during the campaign.
@alanskerritt Couldn't agree more. That's why we have a plan to abolish the USC over next 5 budgets
— Paschal Donohoe (@Paschald) February 6, 2016
The Fine Gael manifesto for the election committed the party to “Completing the abolition of the USC over a 5-year period.” Overall there are 20 mentions of the USC inside the document. Those claims were echoed on the Fine Gael website, which stated that “the USC was an emergency tax that was only intended for the short term” and that, if elected, ““we will abolish the USC.”
5 years ago, 1000s paid their #1st USC under #fiannafail. @finegael will abolish USC over the lifetime of the next Government #ffardfheis
— Leo Varadkar (@LeoVaradkar) January 16, 2016
A bevy of Fine Gael heavy hitters, from Simon Coveney to Leo Varadkar, to Richard Bruton, to Paschal Donohoe promised the removal of the measure. Donohue released a press release in February of 2016 which attacked Sinn Fein and read “At a time when the IDA is stressing the importance of tax competitiveness in attracting talent and investment, Sinn Féin would hike taxes on work. Fine Gael is abolishing USC to create more jobs and keep the recovering going.” Minister Simon Harris had previously made similar comments, saying in October of 2015 that “a vote for Sinn Fein would mean a vote to continue the USC.”
FG is clear on USC – we will abolish it for everyone and then introduce a high earners levy to ensure fairness @ge2016
— Simon Coveney (@simoncoveney) February 23, 2016
These election promises were reiterated, although in an arguably weaker form, inside the Programme for Government published after that election, following negotiations which Donohoe was heavily involved with. That document promised that the Government would “phase out” the USC “as part of a wider medium-term income tax reform plan.”