October 2013 Archives

Budget 2014 - Sharing the Pain?

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The budget indicated that national debt/GDP will remain north of an unsustainable hundred per cent for the foreseeable future. As a consequence, about half of all income tax will be used, possibly for rest of this decade, to meet interest charges on this debt notwithstanding an imminent exit from the bailout.

Against this background, there was no indication in the budget that any new sacrifices are being made by one of the best paid and pensioned cabinets in the world or by their overpaid advisers, senior public servants and wealthy supporters. Where are the moderate salaries, reasonable pensions and equitable taxation that might be reasonably expected as part of an austerity programme which, after several years, continues to be inflicted by the few on the majority?

Letter published in the Irish Times on 21st October 2013.

Budget 2014 - Income Tax Rates

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The IMF's latest Fiscal Monitor Report (10th October) has implied that Ireland's top marginal tax rate (55 per cent) could be raised to almost 70 per cent while still maximising the potential return for the exchequer. This appears to blow a hole in the argument constantly being made by some lobby groups for lower taxes for high earners.

The real problem in Ireland is that top rates kick in at extraordinarily low income levels, This should be addressed without increasing the overall tax take and, if the IMF is correct, without encountering the law of diminishing returns by raising marginal rates for high earners.

Giving more discretionary income to mid-income tax payers would be far more beneficial to national morale and the domestic economy than lowering marginal tax rates for very high earners who, as it stands, benefit from much more moderate effective tax rates on the totality of their incomes.

Letter published in the Irish Times on 12th October 2013.

Saving the Seanad

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So, we have learnt that the actual saving to be made by abolishing the Seanad might be only half the €20 million claimed by the government. In the light of this, the total vote in favour of abolishing the Seanad could also be halved given the huge importance attributed by government to their estimate of potential savings.

The realisable annual saving amounts to less than ten percent of the cost of running Leinster House and to an almost invisible 0.02% of total annual State expenditure. Holding a referendum to secure these minor savings is hardly significant in the current scheme of things, so I assume that there are other more pressing reasons which may not have been fully disclosed to the electorate.

Letter published in the Irish Times on 28th September 2013.

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