Tripling the amount paid by the self-employed in PRSI contributions would be “absolute insanity”, the owner of a restaurant has said.
The Government’s Commission on Taxation and Welfare is expected to propose that the rate self-employed people pay PRSI contributions be raised to reflect the fact that the self-employed are now entitled to a greater number of social welfare benefits.
“If you’re an employee, you pay 4% but your employer pays another 11.05% on top of that,” Charlie Weston, Personal Finance Editor with the Irish Independent, explained to The Pat Kenny Show.
“So if you’re an employee, 15.05% is paid on your behalf in PRSI.
“Most people think it’s a tax but it’s actually a social welfare system. This is what maternity benefits and your pension etc.
“The argument that the Commission on Taxation is making is that over time the benefits that the self-employed have gone up but the 4% hasn’t changed at all.”
However, the proposal has sparked outrage among the self-employed. Paul Treyvaud, who owns Treyvaud Restaurant in Killarney, said that the proposal “cripple the small self-employed guy”.
“The first thing we should do is sack that so-called ‘expert think tank’ if that’s the level of intelligence that they have,” he said.
When asked about the proposal this morning on Newstalk Breakfast, Taoiseach Micheál Martin was coy - something that hugely disappointed Mr Treyvaud.
“It’s absolute insanity and for Micheál Martin to put it on the long fingers shows how weak, how useless this Government is and he is as a Taoiseach.
“Can he not have the strength to say, ‘There’s no way this is happening’?”
While Tim Cullinane, President of the IFA, said farmers would be “very concerned” about the proposal.
“The first point is that we’re not getting the same benefits as a person paying PRSI working in a [salaried] position - whereas a farmer is a sole trader, operating on their own,” he said.
“As well as that, anybody who is in business - even outside of farming - every morning gets up and takes a substantial risk as well to keep your business going.
“And if you look at what we’re dealing with at the moment, we’re dealing with extraordinary costs - agricultural inflation is running at 40% year on year.
“These are the real issues that farmers are dealing with on a daily basis.”
Main image: Young waiter disinfecting table in cafe while wearing face mask.