On Monday December 12th Mick held a public meeting in the Wexford Youths football complex to launch the Wexford branch of the Campaign Against Household and Water Taxes. A large crowd turned out to voice their opinions and discuss the issue with Mick and Dublin TD Clare Daly. The Campaign is aimed at bringing together communities in an effort to organise against unfair and inequitable taxes proposed to begin in the new year. The way in which the government intends to withdraw funds from Local Authorities is particularly cynical in that it leads people to believe that the proposed tax is a local payment whereas actually, the extra revenue will be going to pay the bank bailout, as is the case with many of the increases in indirect taxation.
Several members of the audience spoke passionately about their inability and unwillingness to pay, about unemployment, crippling mortgages and the need for everyone to stand up and be counted. It was felt that the self-registration process proposed for this scheme was a cheap way of completing the paperwork needed for the government to later gather the much more prohibitive property and water taxes which they have made clear are coming down the line, further double taxation on an already decimated nation. It was made clear by several speakers, and the fact is borne out in statistical evidence, that the austerity measures which can never bring our economy to recovery, are making the poor much poorer, and are widening the gap between the wealthy, who are being cossetted and protected and those most vulnerable in our society.
The following day Mick spoke against the Local Government (Household Charge) Bill 2011 in the Dáil arguing that it is deeply unfair as it takes no account of ability to pay. It also represents a serious u-turn by Fine Gael who criticised Fianna Fáil in opposition for their plans to bring in a flat rate charge. See below for the transcript of Mick's speech or click here to watch it.
This Bill is similar in nature to the budget in that it lacks fairness. The Minister said this evening that those who are in a vulnerable position in society will be protected under its provisions. I attended a meeting in Wexford last night at which this measure was discussed and where I met many people who are not confident this will be the case. The Minister was also keen to emphasise the implications of a refusal to pay. People in this country are already frightened enough; there is no need to frighten them any further. It will look strange if judges are penalising ordinary people who cannot afford this charge when there is no record of any banker being fined. I recall being in court one day and seeing a woman who had stolen a pair of shoes from a large store, for which she was sentenced to three months in jail. However, if one manages to steal millions, it is called big business.
The household charge is a form of indirect taxation. Such taxes are unfair because they take no account of a person's capacity to pay. Unfortunately, this State has one of the lowest levels of direct taxation in Europe but one of the highest levels of indirect taxation. A recent report by TASC showed that the increase in the VAT rate to 21% absorbed 16% of the income of the less well-off, while the corresponding figure for those who are better off was 6%. Yet the budget increased the higher rate of VAT by two percentage points to 23%, thus increasing the disproportionate burden on those who are least well off.
The Taoiseach told us in his address to the nation that the Government would give people certainty by imposing no increases in income taxes. If one is making €600 per week and an increase in income tax leaves one with €540 or €550, there is a certainty in that. It might not be fair, but it is certain.
When indirect taxation, such as VAT increases, there is more uncertainty because one cannot measure one's costs. The household charge is another unfair measure. In 2008, this country collected more money in indirect taxation than in direct taxation. It was screaming out to any fair-minded person that introducing a tax band of 55% for those earning over €100,000 would have brought in €750 million. This is almost equal to the figure of the social welfare cuts. I do not think those earning over €100,000 would be screaming if they had to pay a bit more tax on what they earn above €100,000. However, our Government has chosen to do things differently.
The ability to pay is a significant aspect of this household charge. The unemployment rate is 14.5% and the rate of long-term unemployment is 56%. People have to deal with household and credit card debt. There is no protection for pensioners and their fuel allowance has been cut. I am flabbergasted at the Government. I do not normally quote what has been said by the Government. One year ago, the Fine Gael Party recognised the need to raise more revenue from property "if we are to minimise the more economically damaging tax increases on jobs, enterprise and consumption". It further stated:
"The Fianna Fáil-led Government proposal to introduce a steadily rising annual recurring residential property tax on people's homes is unfair for three reasons. The initial flat rate charge means that houses in standard neighbourhoods worth a fraction of some mansions would pay the same rate of tax. It would be difficult for asset-rich but income-poor households to pay, particularly the elderly and the unemployed. It would be deeply unfair in the case of a young generation that paid exorbitant amounts of stamp duty and VAT on the purchase of over-valued houses, many of whom now find themselves in negative equity."
I ask if this is the same party.