A REAL VIABLE ALTERNATIVE VISION FOR TAX, SOCIETY AND PROSPERITY EXISTS
Published: Wednesday, September 15, 2010
A campaign for a progressive taxation system in which all citizens contribute according to their means was launched this morning by the Community Platform. The additional revenues raised primarily from non-productive wealth would halt the vicious cutbacks in public services and community provision that are inflicting deep pain on the most vulnerable in society.
The Community Platform's strategy document '4 Steps 2 Recovery' was launched at an event chaired by Branardos' CEO, Fergus Finlay. The launch was also addressed by Dr. Tom O'Connor, Lecturer in Economics and Public Policy in CIT and Anne Costello of the Community Platform.
Anne Costello said "The Community Platform is challenging the current political and economic rhetoric that is focused on cutbacks. To get back on the road to recovery we need new, fresh thinking and that is what we are proposing today.
"The Community Platform recognises the serious deficit in the public finances. Today we are launching four tax reform proposals that will raise approximately €3bn euro without inflicting an additional burden on low and middle income families who have already borne the brunt of recent budgets.
"Our proposals will introduce a sustainable and progressive tax system. For decades significant amounts of wealth in Ireland have gone untaxed. The wealthiest in our society have been able to reduce their tax contribution significantly. For instance:
- Last year the Exchequer lost €7.4bn as a result of the tax break regime - over three times the EU average.
- A recent ESRI study showed that 80% of the tax relief available on pension contributions goes to the top 20% of earners.
- The Commission on Taxation revealed that this same group of earners gleaned nearly €300m a year in mortgage interest relief
"The picture is clear - we have an inadequate, unjust taxation system that must be fixed. A progressive tax system will protect spending on vital services, retain jobs and support consumer demand. It will avoid the potential disaster that draining another €3bn out of the economy will have on businesses, communities and the self-employed throughout the country.
In summary the Community Platform proposals are:
Step 1 Tax breaks - reduction in tax breaks to EU average over a three year period, saving an estimated €1.5bn per year.
Step 2 Tax wealth - One third of the country's financial and property assets are owned by the top 1% of households. Much of this wealth remains untaxed. The Community Platform is proposing a wealth tax for high earners with assets worth more than €1m.
Step 3 Tax levies - Income from capital, rents and investments should be treated like PAYE income and be subjected to PRSI and income levies. The income limit for PRSI payments should also be removed.
Step 4 Tax exiles - In 2007 it was estimated there were 6,000 individuals claiming non-resident tax status in Ireland. This list includes some of Ireland's wealthiest people. High earning Irish citizens can limit their tax liabilities to just €200,000 per year through claiming non-residency status. This massive tax avoidance can be removed by making citizenship, rather than residence, the basis for taxation and thus target high earners using tax havens.
"This country faces a vital choice. The current path will result in persistent unemployment, economic stagnation and an assault on the fabric of communities. There is a real, viable alternative - an alternative that promotes consumer demand, stimulates economic activity and is sustainable and progressive. Budget 2011 has to bring new hope and new vision to Ireland. By adopting the proposals launched today by the Community Platform we can begin the journey to social and economic recovery.
For more information contact Anne Costello at 087-6577666
*The Community Platform is a network of 29 National organisations which work to address poverty and social exclusion. Organisations currently in the Community Platform are: ATD 4th World, Age Action Ireland, Community Action Network, Community Workers Cooperative, Cairde, European Anti-Poverty Network (EAPN) Ireland, Focus Ireland, Gay and Lesbian Equality Network, Immigrant Council of Ireland, Irish Association of Older People, Irish National Organisation of the Unemployed, Irish Penal Reform Trust, Irish Refugee Council, Irish Rural Link, Irish Traveller Movement, Migrant Rights Centre Ireland, National Adult Literacy Agency, National Traveller Women's Forum, National Women's Council of Ireland, Older Women's Network, OPEN, Pavee Point, Rape Crisis Network Ireland, Safe Ireland, Simon Communities of Ireland, Threshold, Voluntary Drug Treatment Network, Vincentian Partnership for Justice, Women's Aid.