We Shouldn't Blindly Follow Europe on Tax
Byline: Joe Higgins ANOTHER VOICE
OVER the past few weeks, speculation has intensified about the proposed property tax which we are told the Government intends to introduce next year following an announcement in the Budget speech in December. There is an absence of hard information from the Government but, in general, in the establishment media there is agreement that a property tax should be imposed with the rider that it should be 'fair and equitable'. For property tax we should substitute 'home tax'.
A number of arguments are advanced as to why this State should now burden its hard-pressed workers, pensioners and social-welfare dependents with a new tax.
Among the most common reasons why we should be so burdened, they say, is that 'every country in Europe has some form of property tax' and that a property tax 'broadens the tax base by reducing the reliance on taxes on work'.
Both are lazy arguments that provide no justification for what is being planned.
The fact that many European countries may have some kind of property tax in place is not a reason to blindly follow here.
Any comparison in the field of taxation, as with wages and salaries, would have to take a multiplicity of factors into account before any meaningful conclusions could be arrived at.
Thus the rates and amounts of income tax and of indirect and stealth taxes obtaining in different jurisdictions would have to be factored in.
So also would the rate of tax on big business profits which in this State is nearly the lowest in the European Union.
The advocates of the property tax do not match their enthusiasm for this facet of alleged European practice with demands for other aspects of social or economic policies that enhance the lives of citizens in some other EU member states and are far in advance of what exists here.
Affordable childcare is an example that would spring to mind.
Among the most dishonest of arguments is that a tax on people's homes reduces a reliance on tax from workers' wages and salaries.
The implication is that the money to pay a home tax will come from some mysterious source available to the ordinary worker. People's dwellings do not generate any income. The reality, therefore, is that such a tax would have to come from the very same wage that PAYE income tax is taken from. The semantics and political dishonesty involved in the 'broadening the tax base' argument is now shredded with the proposal that the Revenue Commissioners will be made responsible for the new tax and that they may have the power to deduct it directly from workers' incomes. …