O'Leary: 'I'll quit Ireland if they raise income tax'
Ryanair boss threatens to leave the country over rates for high earners
CONTROVERSIAL Ryanair boss Michael O'Leary has warned that he will leave Ireland and become a tax exile if rates for high earners become exorbitant.
"I start to get pissed off when tax rates get to 60 per cent or up to 80 per cent. At a certain point, people just leave. I would have no compunction about becoming non-resident if the rates went up to 75 or 80 per cent. I won't work for that," he said in a wide-ranging interview in his office at Ryanair's Dublin headquarters.
As further cuts and tax rises are predicted for the up-coming budget, the airline boss -- who earned a salary of €1.1m last year -- called for the income tax system to be simplified.
"Anybody earning under €50,000 should pay 10 per cent tax," he says. "If you're earning under €100,000, you pay 25 per cent and anybody earning over €100,000 pays 50 per cent.
"I'm one of the largest taxpayers in the country and I have no problem paying 50 per cent of my income in tax."
The plight of the economies of the whole Western world -- including Ireland, which is struggling to reduce an €18bn fiscal deficit -- is so dire that the ability of economies to support the welfare state as we have known it is now questionable, he argues.
"One of the upsides of this is that we can't afford all these ludicrous social programmes that we've inherited over the years. The lesbian rights association lose their funding -- great -- they shouldn't be getting it anyway.
"One of the great things we did was free education, but once the children go to school at the age of five, cut the children's allowance. There's €2bn saved.
"You can no longer get breast enhancements on [Britain's] NHS: tough. We can't afford this any more.
"Europe will realise, as they are in the US, that a tiny proportion of the working population supports a ludicrous amount of incentives and feather-bedding for people who don't want to or won't work," he said.
All semi-states should be sold off to help plug the gap in our finances, and inflation-linked, defined-benefit pension schemes should be abolished, the 50-year-old businessman added.
"There needs to be more sensible austerity. We should eliminate the €18bn deficit over a three or four-year period. If we were committed to doing that, we'd get massive inward investment in Ireland. Our borrowing costs would go down significantly. It may require more taxes, but the taxes are coming anyway.
"We've got to cut waste and drive efficiency, sell off the assets we don't need to own: airports, bus companies, train companies. But the government won't because they're terrified of the unions.
"At the moment the tax on the declining working population will be increased, while failing to address the inefficiencies in health, the likes of Fas, the waste in government departments, public sector pensions. The country is broke. You can't have your defined-benefit, inflation-linked pension. You're now on stakeholder pensions: good luck. But the government is terrified to do anything like that."
O'Leary has other proposals to radically shake up the Irish economy.
"I'd privatise the health system. Everybody should have mandatory national health insurance. The government pays the health insurance for the poor. Then you or your insurance company are paying for your treatment.
"You've got very good people in the health service, but there's no management.
"We have operating theatres all across the country operating from 9 to 5, Monday to Friday. It's bullshit. They should be operating seven days a week from 6am to 10pm. We should regard consultants like pilots. You'll work across a seven-day cycle, four days on and three days off.
"We waste billions a year in this way: expensive machines and operating theatres are not being used for two-thirds of the week. I've got a €70m aircraft and it's flying from 6am to 11pm seven days a week. Hospitals and their expensive machines should be the same.
"Whether it's the doctors or whoever owns the hospitals can make a profit out of it, because the usual bullshit that we'll be exploiting people's health is nonsense. Profit comes from maximising efficiency and lowering costs.
"Ryanair has the lowest air fares in Europe and we make a profit. Aer Lingus loses money most of the time and has high fares here in Ireland, mostly because it's government-controlled and therefore it's run to satisfy a trade union.
"But you're not allowed to say that in this country, because we've had 20 years of social partnership. But that has helped to destroy the economy."