Are these 'emergency' measures temporary or here to stay?

hatrickpatrick

Things which were in the budget such as the 1% or 2% tax levies for everyone, and the €10 airport charge - are these measures temporary, IE until the end of the recession, or are they permanent?

Burial

These would more likely be permanent. They'd only get rid of them not after the recession but well into another Celtic Tiger period. I mean this is all to stop raising offical taxes. It'd also have something to do with the Greens as this would discourage flying more, as it'd make it more expensive.

Économiste Monétaire

The chances that there will be another period that perfectly replicates the Celtic Tiger period, an average of 9% growth, is effectively zero. A reasonable level of natural growth would be around 2-4%.

gurramok

The budget only plugs €2bn of the projected €14bn+ deficit next year (http://www.budget.gov.ie/2009/financialstatement.html#13 )
"The revenue package announced today raises an additional amount close to €2 billion in 2009. "

Unless i've missed something, expect more emergency budgets and cutbacks in the near future.
They cannot drain anymore out of the private sector bar targetting high earners/property investors etc without deepening the recession so the public sector will have to be trimmed to bring expenditure in significantly.

P_1

Apologies if this has been posted before but I'm still trying to get my head around this 1% 'levy'.
Am I right in saying that this is taken from me before my taxcredits are counted?

For example, say I earn €150 in a given week and have tax credits worth €50 a week.
As 20% of €150 is €30 normally I wouldn't have to pay tax but taking this new levy into account Biffo and his cronies take €1.50 a week off me regardless of my tax credits.
Is this correct?

mike65

Health Levy introduced 1992, still in place. Insurance Corporation of Ireland levy introduced 1984 and still with us I think.

Mike

A Dub in Glasgo

A levy is an increase in tax. Cloud cuckoo land for those who think otherwise. Taxes increase and decrease in line with what the government of the day want.

ArmaniJeanss

There used to be a departure tax (I think it was 5 old punts, and fairly sure it applied to both flying and sailing) and it got removed.
And there has been previously been an income tax levy (early 90s) which also got removed.

So they aren't certain to stay, though its hard to see them being removed short/medium term.

is_that_so

Levies have a chequered history and often continue on quietly, mostly because people adjust and over time can't remember why they were brought in, in the first place. Governments carry on applying them in the absence of any concerted campaigns against them.

The use of the "levy" for the tax increase is pure political spin. By emphasising the "temporary" nature of it and the fact that it is a "levy" they cannot stand accused of being the first Govt to increase tax since the 1980s. It is a softly softly way to get us used to paying higher taxes. Next year this could disappear and be replaced a 1/2% increase in tax rates in an effort to "take more people out of the tax net". :rolleyes:

SoCal90046

In the US, there are two temporary measures that I can think of that became, essentially, permanent.

Withholding of taxes from federal wages was introduced as a temporary measure in 1943 during World War II; it still exists and shows no sign of going away.

Here's another one with a happier ending. In 1898, Congress authorized the Internal Revenue Service to collect an exise tax on long-distance telephone service; the tax was introduced to help pay for the Spanish-American war, a conflict that lasted all of four months. The tax was supposed to be a temporary measure, but wasn't repealed. In 2006, the Department of the Treasury decided it would no longer require phone companies to collect this tax! So, be of good cheer; there's evidence that somewhere on this little planet that it only takes 108 years to reverse a temporary measure.

leninbenjamin

it's a quick fix. and with all quick fixes, there's the chance that they may work too well and no one will get around to properly addressing the root cause of the problem. so in short, f*ck knows.

smurfy89

Most of the new taxes and levies will more than likely be in place for the next 3 or 4 years. Doing an economics & politics degree .. probably not the best time to be doing it!