Sir, – Compared to most other countries, even those with left-wing governments, Ireland’s tax and welfare systems contribute significantly to income redistribution and the continued reduction of income inequality. The Irish income tax system has become more progressive over time under successive governments and ranks unquestionably among the most progressive in the OECD.
Moreover, the Irish government currently spends more on health and housing than the vast majority of our peers. Ireland’s tax and welfare systems are even more progressive than those of the very famous Scandinavian countries championed by leftists, but it seems most voters either don’t know or may not be interested. Instead, a culture of selective distortion, populist narratives, personal frustrations and fake rage has become commonplace.
Sinn Féin’s economic story is that it can raise taxes on employment, high incomes, wealth and capital, inheritance and property transactions without negatively affecting our open economy, where trade and Investment is currently thriving, job booms and tax revenues are already showing impressive momentum. Sinn Féin says its additional tax plans will have no negative impact on employment, productivity, wealth creation and tax returns. The party plans to introduce a new 3% tax on earnings over €140,000 and scrap tax credits on earnings over €100,000, dramatically increase the PRSI for employers, lower the threshold standard fund for private pensions and lowering the earnings contribution limit for permitted exemptions, to remove the special assignee relief program for employees of multinational corporations that is designed to attract and retain investment capital in Ireland. Sinn Féin also plans to raise the rates of capital gains tax and capital acquisitions tax and lower the inheritance tax threshold to levy more tax on the children of deceased parents, to introduce a new annual wealth tax, to increase the stamp duty on the -assessed on residential properties and on all commercial properties.
Sinn Féin’s message is that it can extract ever-increasing taxation from the productive sector, employers, investors, multinationals and high earners and these stakeholders will simply succumb, with no negative consequences on employment, productivity, wealth creation and tax returns. The reality, if these policies were to be implemented, would be very different. Tax yields will fall and public services and investment will eventually suffer. The mobility of capital, investment, wealth and jobs of multinationals must be properly assessed. We must at least begin the process of examining the experiences of other countries where governments led by left-wing parties have come to power. The assessment must include a detailed analysis of the likely impact on economic growth, on business investment, on employment and, above all, on the tax revenue available for redistribution, public services and investment in climate change. And of course in Ireland there is the huge complication of Sinn Féin’s primary goal of creating a unified socialist state. The implications of their likely actions in pursuit of this objective must be considered in the larger assessment of consequences. – Yours, etc.,
Sir, – Someone once said that budgets are moral documents and should reflect the values and priorities of the people.
Tánaiste Leo Varadkar promises a “very substantial” income tax cut in the next budget (“Coalition promises tax package that will benefit almost all workers”, News, August 11). Doing so in the current circumstances is a clear expression of priorities – but which priorities?
Does Mr. Varadkar think we would rather see our income taxes cut at the expense of solving the housing crisis or postponing the creation of a one-third health care system? Does he think we care little for children in poverty or for the many single parents who raise the future in constant deprivation?
Does he really think so little of us that he sees his proposals right now as a reflection of who we are? – Yours, etc.,