Friday, June 14, 2013

Opposing the Family Home Tax

This week the Sinn Féin Dáil team introduced a Private Members Bill to repeal the Irish government’s family home tax – property tax which takes effect in July.

Fine Gael and Labour combined to vote it down in the Dáil on Wednesday evening. Notwithstanding this Sinn Féin is committed in government to repeal this tax.

Our Finance (Local Property Tax Repeal) Bill was about lifting the burden of the government’s unfair property tax from families and households and replacing it with alternative measures to raise taxes, including a wealth tax. It was about undoing one of many bad policy decisions taken by Fine Gael and the Labour Party in the past two years.

Fine Gael and the Labour Party were elected to undo the damage caused by Fianna Fáil, but they have instead chosen to implement Fianna Fáil policies. This has led to greater inequality, poverty and disadvantage. This week the cuts to the respite care grant take effect and will hit 77,000 of our most vulnerable citizens. Emigration and unemployment are at record levels, especially among young people. Public services, particularly health, are in crisis, with further cuts to be imposed this year.

The economy, particularly the domestic economy, is flatlined and, on top of all that, the family home tax is being imposed on citizens.
I listened on Tuesday and Wednesday night during the Dáil debate to a succession of Fine Gael and Labour Deputies trying to defend the government’s tax on the family home. They sought to do it, if we could believe this, and I do not believe that they believe this, by comparing it with the domestic rates system in the North.

They must know - and if they don’t they should take a run up the road and they will see - that rates in the North cover a range of public services, including education - those who live there do not pay for school books, emergency services or the public health service. There are no prescription charges, no private bin collection charges, no road tolls, and water and sewerage services and even septic tank services are provided.

The Fine Gael and Labour also know that Sinn Féin blocked the introduction of domestic water charges in the north.

Of course there are inefficiencies in the services but the rationale the Minister for Finance in his defence of the tax gave as his justification of it that the big boys – the Troika of the European Central Bank, the International Monetary Fund and the European Commission – made them do it.

Before the Government parties came into office they said that they opposed this property tax. In the Fine Gael Election manifesto the people were told:

“Fianna Fail’s proposal, now endorsed by the Labour Party, to introduce by 2014 an annual, recurring residential property tax on the family home is unfair” (P59)

Indeed the Taoiseach himself in a campaign against a previous FF Property Tax said “It is morally unjust and unfair to tax a person's home

The property tax that this government has introduced takes no account of ability to pay or of those in negative equity; and it ignores the fact that one in four mortgage holders is in mortgage distress or the many others stuck in homes whose value has dropped and on which they have paid huge stamp duty.

It is a tax that was proposed by Fianna Fail and now, as we see, it is being implemented by their brothers and sisters in arms, Fine Gael and Labour.

The Government has also ensured that Revenue has the means to take this tax irrespective of the individual or family circumstances. Let the big bankers, the big developers and the speculators off free, award its policy advisers exorbitant, high salaries but deduct the tax from people's social welfare benefits, from their wages, their bank accounts and even from their credit union accounts.

This is despicable - going after those who cannot afford it. As a consequence of their actions more and more people will be driven further and further into debt.

There are alternative measures that the Government could have taken, including the introduction of a wealth tax on all property, liquid and assets, above a certain net wealth.

Why could they not do that?

Why could it not levy a 1% wealth tax on all net wealth over €1 million with certain exclusions? Because it is based on net wealth, it takes into account mortgages and loans. Because it has a high value, it protects struggling families.

And because it is aimed at high net worth individuals, it is dealt with by people used to engaging with the revenue system, who very often have tax accountants dealing with the system on their behalf.

So Fine Gael and Labour had a choice. There are alternatives.

They could have opted to take more from those who can afford it.

Instead, Labour and Fine Gael chose to inflict more pain on struggling families.


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