Siptu vice-president had 'severe reservations'

DISSENT:A SENIOR trade unionist who was a member of the Commission on Taxation said he did not sign the report because he had "severe reservations" about it.

Siptu vice-president Brendan Hayes, who was the only member of the 18-person commission not to endorse the report, said the commission’s recommendations reinforced a low tax model of the economy and of society that he did not support.

His reasons were set out in a letter to commission chairman Frank Daly, which was included in an annex to the report.

Mr Hayes said the commission was required by its terms of reference to uphold the current low tax policy. “Consequently the commission’s report will neither fairly distribute the burden of taxation nor generate, in a progressive manner, sufficient revenue for the State, to ameliorate those disparities or enhance social provision and cohesion whilst supporting economic growth,” he wrote.

The manner in which the low tax policy informed the commission’s findings was “fundamentally flawed and is inhibiting economic growth, exacerbating social and economic inequality and inequitably distributing the tax burden,” he added. The low tax model, together with the current national economic and social policy framework had made our society “profoundly unequal”, he said.

Mr Hayes said advanced European countries normally deployed tax and social security systems, strategic State involvement and well-financed public service to moderate such inequalities. “However where the State adopts a low tax policy, in the manner in which this State has, the result is an underfinanced set of public services, including health, education and local government, and an inadequate social security infrastructure which further exacerbates inequality, reduces social cohesion and retards economic growth.”

He also claimed the commission had struck the wrong balance between fairness and efficiency in its recommendations in a number of areas. “For these reasons I have severe reservations on the report of the commission and respectfully decline to sign it.”

Mr Hayes said that when he accepted the invitation to serve on the commission, he was aware that its remit could present difficulties but he felt it was possible to make progress. He said he believed the commission “took its task very seriously, went about its work in a conscientious manner and arrived at its conclusion with honesty and integrity”.