Finance Minister, Michael Noonan, has said that he has no intention of reversing tax individualisation. This is despite opposing it when it was introduced by Charlie McCreevy in Budget 2000.

Speaking on Today With Sean O’Rourke, Mr Noonan said in response to a caller’s question that individualisation was now a key part of the tax system, and that he would not be repealing it. But he didn’t close off the possibility of doing something to ease the burden on stay-at-home parents, saying, “I’ll see can anything be given by way of an individual allowance”.

Child Benefit was increased by €5 per child per month in yesterday’s budget, but the government took no steps to address the higher level of tax paid by single-earner married couples compared with two income married couples, despite the fact that both Mr Noonan and Tánaiste Joan Burton opposed tax individualisation when it was first introduced.

In response to a charge from listener Brendan Conroy that individualisation was unequal, and treated people who work in the home like “second-class citizens”, Mr Noonan said that while he had opposed individualisation when it was introduced by the then Finance Minister Charlie McCreevy, he was not going to be revisting the question as “society has changed.” He said that individualisation “treated people unequally as families, but not as individuals”.

Minister for Public Expenditure Brendan Howlin said that to reverse individualisation would cost the exchequer €700 million a year. He didn’t respond to the listener’s question regarding partial measures, such as those advocated by Táiniste and Labour leader Joan Burton.

In 2007, Ms Burton wrote the introduction for a report on tax individualisation commissioned by the Iona Institute, in which she said that while de-individualising tax entirely would be too expensive, other measures could be taken, such as “(bringing) the Home Carers Credit (which was then €770 per annum) up to the level of the PAYE credit of €1760.” She continued “To do this in one year would cost up to €100 million. I believe it would be money well spent. It would also allow couples more space in which to decide what is best for them and their children. It would allow greater options in lifestyle, particularly for families struggling to care for 2 or 3 young children in their early years.”

The Home Carers Credit is currently €810.

A new report from the Iona Institute finds that a single-earner family with three dependent children earning one and a half times the average industrial wasge would be more than €3,000 euro per annum better off under 1974’s tax system than under today’s system even after taking into account Child Benefit.