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Getting someone else to pay the household tax. December 28, 2011

Posted by WorldbyStorm in Economy, Irish Politics, The Left.
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There’s a brilliant line in a letter to the Irish Times last week about the Household Charge. The letter attempts to draw a comparison between the charge and TV licences, etc, arguing that because they’re flat then the charge is legitimate.

I can’t understand why Mr Higgins has never protested at the unfairness of some other “flat” taxes, such as the following. The TV licence fee is a €160 annual flat tax on every household, regardless of house size or income, or the number of TVs owned (Joe Duffy and Pat Kenny please note!). Annual motor tax is based on engine size, no one is asked what their income is; indeed, the changes in 2008 make it cheaper for those better-off motorists who can afford newer cars.

That sort of misses a number of points – not least that such fees are regressive and progressives are [in general] against them and are [generally] in favour of income taxes. Then there’s the issue that the new charges exemplify aspects of contemporary economic and social policy in a particularly pointed way, in a way which is much clearer than a – currently – quixotic campaign against TV licenses or whatever. Then there’s the further issue that although starting at €100 we have no real sense of where these charges will end in terms of how large they may be. Then there’s the issue that although we are promised they will be progressive – copyright P. Hogan, given the lassitude on the part of the government to date on the issue and their abysmal portrayal of VAT increases as not impacting on those on median and lower incomes what credibility should we afford their protestations.

There’s also the issue that the backlash started by the left has actually engendered responses from the government which are shifting towards clarity on the issue. That in itself is all the justification needed in a democracy for protest and opposition. Though from the howls of upset in the media one would think that the left was committing the worst form of lese-majeste in daring to query such policies.

As was also put to me this week, if the left complains about an issue such as flat tax the criticism is raised that they’re not looking at issues x y and z, if they contest issues x y and z they’re told they’re against everything.

By the way Mick Wallace has a not bad letter as well which can be read at the link above which points out that – er… if grandstanding were done on the issue it was done by Fine Gael who adamantly opposed a ‘flat rate charge’ in their election manifesto.

But let me finish this post with what’s really great in the letter referenced above:

We need our politicians, media commentators and lobby groups to behave responsibly and stop the populist posturing. The general public recognises the gravity of our financial situation, national and individual, and realises that we can’t always get someone else to pay. – Yours, etc,

Well actually, with a flat tax that’s precisely the problem. There those with more income are getting those with less income to pay proportionately more relative to their incomes.

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Comments»

1. Eoin - December 28, 2011

I had a conversation over Christmas with a neighbour about the tax: “sure, if they don’t get you this way, they’ll get you in another”.

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WorldbyStorm - December 28, 2011

No doubt at all there. Though if it was through income tax it would at least have the virtue of being less regressive.

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Eoin - December 29, 2011

All of this was presented to said neighbour but remained resistant to resistance.

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WorldbyStorm - December 29, 2011

I know the problem, it’s a tough old slog, isn’t it?

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2. Tomboktu - December 28, 2011

some other “flat” taxes, such as the following. The TV licence fee is a €160 annual flat tax on every household, regardless of house size or income, or the number of TVs owned (Joe Duffy and Pat Kenny please note!). Annual motor tax …

Eh, no. The TV licence fee does depend on the number of TVs in the house; posess zero TVs and you pay no TV licence fee. Likewise for the annual motor tax: own zero cars (and whatever else the tax applies to) and you pay zero motor tax.

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WorldbyStorm - December 28, 2011

Exactly so. What’s interesting to me about the line of arguments taken by letters such as the above quoted, above and beyond issues of regressive/progressive taxes etc, is the remarkable lack of understanding that to some people €100 is genuinely a problem to pay. It’s simply outside their comfort zone and therefore impossible to grasp.

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3. More from the orthodoxy on the household charge, water charges… and the current political context « The Cedar Lounge Revolution - December 29, 2011

[...] Not the same thing and the rationale for campaigns around the household charge as against such licenses is dealt with in yesterday’s post here. [...]

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4. Rising Boats, Trickle Down Economics And The Politics Of Regression « An Sionnach Fionn - December 30, 2011

[...] Fine Gael election manifesto to oppose any iniquitous forms of taxation such as a “flat rate” charge? “Honesty requires us to admit that in areas such as banking reform and the debt crisis we [...]

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5. RTÉ Should Be TG4 – And Here’s Why « An Sionnach Fionn - January 4, 2012

[...] in the age of multiplatform devices, where a licence for a “television set” is simply an anachronism, direct state funding, overseen by a fully independent body, is the only sensible way forward. A [...]

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