Tuesday 27 September 2016

The one million suckers who are paying for the bailout have taken enough

Published 05/03/2016 | 02:30

'Most middle-income people paid their water charges, realising it is unpalatable but necessary to fund vital infrastructure, and broaden the tax base'. (Stock picture)
'Most middle-income people paid their water charges, realising it is unpalatable but necessary to fund vital infrastructure, and broaden the tax base'. (Stock picture)

The teen and the tween had a question about politics.

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My wife and I were shocked.

These are the kids who had largely tuned out of the coverage in the previous week of the political eruptions taking place as the election results rolled in.

Now my daughters wanted to know if their parents had paid their water bill.

We had. But the young ladies in my house could not understand why some people paid up, and others had not.

Was it not the law? Why do some people pay taxes and charges while others don't? They wanted easy answers, but there are none.

However, my girls did get to the core issue.

One million suckers have paid their water charges.

They are the same one million suckers who paid all the new taxes, charges and levies imposed since the financial collapse of 2008.

And one million people now know that any benefits of an upturn in the economy will be largely kept from them.

Because the political agenda has been hijacked by those who want to abolish any tax or charge that they don't like, and instead impose the costs on middle earners.

The betrayal of middle Ireland is galling.

Throughout the near collapse of the financial system, it has been ordinary middle-income families that have rescued the situation.

Tax-paying, education-promoting and law-abiding, the sat-upon middle-income families have been the stout defenders of the system.

Who paid for the outrageous bailout of the banks, the shoring up of the public finances, and the cost of keeping the social welfare system largely in tact?

The cost has been enormous.

Most middle-income people paid their water charges, realising it is unpalatable but necessary to fund vital infrastructure, and broaden the tax base.

The leaned-on middle don't want much, but a lot of what they had taken for granted up to 2008 has disappeared down a cracked sewer.

Being part of middle Ireland used to mean a reliable job with fair pay. At the end of work, a pension to fund retirement years used to be taken for granted.

Being middle class used to mean being able to afford reasonably-priced healthcare, because the public system is so shaky.

Taxes that are not punitive, were a not-unreasonable demand for those who see themselves as paying for everything.

A safe and affordable home, and the opportunity to provide a good education for one's children, including a college education, were also part of the deal.

But today this standard of living is increasingly precarious.

The existing middle class is being squeezed and many of those striving to attain the middle-class standard find it out of reach.

The middle is pushed and prodded in all directions.

Saving for a pension? You fool. The State has taken a big chunk of that in the form of a pension levy on private sector workers where pension pots are a pittance anyway.

Paying for health insurance, because you fear your children will be denied access to a specialist in a reasonable time frame? Well, the State has added to the huge cost of this by restricting your tax reliefs and imposing extra charges on your insurer for using public beds, even though you already pay for the HSE-managed mess that is the public system.

Drive a car? Motor insurance costs are soaring, and some of the blame for that can be laid at the feet of a State apparatus that has failed to regulate it properly.

Some 700,000 income taxpayers have now been taken out of the tax net due to changes to the universal social charge(USC) system. This increases the burden for those left paying, and gets rid of the only positive aspect of the USC - the fact that it was universal when it was first introduced.

Given all this, an unseemly scrap about paying for water should be the least of our concerns.

Those who paid for water had been short-changed well before they stumped up the charge. Now they may have paid in vain.

Fine Gael and Fianna Fáil need to stop and think. They must not push the rule-observing, decent middle income people of Ireland too far.

They should resist pandering to an agenda set by those spouting financial fantasies about how we fund the State if we abolish Irish Water, scrap USC, and whatever else you're having yourself.

Nobody likes these charges, but we need to be mature about how we replace them. Taxing the rich is the constant refrain from these magic-mushroom economists, even though the top 1pc of income earners are now estimated to pay 22pc of all income tax and USC, according to the Irish Tax Institute.

Abolishing Irish Water may be popular, but it is also expensive and irresponsible now that it is in place.

One hundred years after the 1916 Rising, there is a huge danger that we will rebel ourselves into a situation where we become ungovernable.

Irish Independent

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