Department of Finance publishes proposals to phase out USC

The Government has some €300m available for cuts and spending increases in Budget 2017

Department of Finance publishes proposals to phase out USC

Fine Gael Party Leader Enda Kenny TD, centre, and Finance Spokesperson Michael Noonan TD, left, and Leo Varadkar Photo /RollingNews.ie

The Government has published plans to phase out the Universal Social Charge between now and 2020.

Potential tax and revenue options for October's budget have been published ahead of the Dail's summer break.

Analysis from the Department of Finance however adds that doing so would require the use of all the money that is available for tax cuts.

The “tax strategy papers” outline ways of cutting the UCS, which would be counterbalanced by tax increases for higher earners, and possibly increases for low income earners who are currently paying USC and broadening tax bases in other areas.

This is the first time that public servant's proposed budgetary measures have been published - this is intended to aid debate around fiscal decisions.

Phasing out the USC in this timeframe is projected to cost between €1.78bn and €1.86bn.

The report proposes the retention of mortgage interest relief beyond 2017 and other new tax revenue streams, such as a sugar tax.

Other possible measures include a "supportive tax regime" for entrepreneurs and people who are self-employed.

In total €330m is expected to be made available for tax cuts in the upcoming budget, this is less than half the amount used for cuts and giveaways in 2016's pre-election budget.