Property tax must be seen to be fair to avoid animosity

INSIDE POLITICS:The Government is avoiding speculation about the budget but the rest of us need a national debate about it

THE NATIONAL obsession with property runs deep, going back to the time when Charles Stewart Parnell urged tenant farmers at Westport, now part of Enda Kenny’s constituency: “Keep a firm grip on your homesteads.”

It’s four months to the budget in December and already the speculation is starting. But when the present writer sought to winkle some information out of the Tánaiste late last month, Eamon Gilmore wasn’t having any of it. The Labour leader has an effective way of dealing with difficult or awkward questions. He repeats the subject again and again with great emphasis and the uninitiated think they are getting somewhere, but they later realise he has given nothing away.

This is what he said: “I’m not talking to you about the budget: i’m not talking about the budget until the budget time. this is july, the budget isn’t until December and it’s far too early for discussion and speculation about the budget.”

In two sentences, Gilmore mentions the budget five times but at the end we are none the wiser. It’s no surprise that he is reluctant to be drawn on the subject. Even in a single-party government there is jockeying and infighting as ministers and their departments compete for a bigger share of the cake, and this is a Coalition embracing several shades of the political spectrum.

However, as he might say himself: the budget is the budget is the budget. The Tánaiste may see it as the best part of his play to remain tight-lipped but the rest of us need to have a good national debate in advance about its contents – and I don’t mean some motormouth in the studio audience giving stick to Michael Noonan on television.

The Irish people are like the Cúchulainn statue in the GPO. We are strapped to a rock, the life draining out of our bank accounts. The troika is the equivalent of the raven landing on the Celtic hero’s shoulder, signalling he has finally given up the ghost.

Under the bailout agreement there must be at least €1.25 billion in new taxes next year and spending has to be reduced by €2.25 billion. The personal income-tax base must be broadened and that includes bringing in a property tax at what the International Monetary Fund calls “a suitably high level”.

The household charge was meant to be an appetiser for the property tax, set at a modest €100 per annum. It turned out to be a major turn-off instead for many people, not least because of the method of collection.

In the words of former taoiseach Seán Lemass: “People pay other taxes in sorrow but they pay their rates in anger.” Wisely, the Government has decided to give the Revenue Commissioners the task of collecting property tax. Property tax is the new rates and, if it is not to incite serious public ill-feeling, must be seen to be fair. Although it’s still early days, the notion of a higher rate for owners of larger homes is being floated. That’s the way it is already with income tax: the more you earn, the higher the percentage deduction.