Kenny: Income-tax pledge depends on IMF re-negotiation

godtabh

Link

The Taoiseach has admitted that his promise not to increase income tax in the Budget is dependent on the say-so of the IMF.

Enda Kenny said the previous government committed to increasing income tax each year for the duration of the bailout deal and that promise will have to be renegotiated.

Earlier this year Mr Kenny, promised not to hike up income tax and not to cut social welfare rates in December's budget.

But in the Dáil he has admitted that it will be up to the EU and the IMF to allow the Government to fulfill that pledge.

"This is a matter that has to be renegotiated by the Minister for Finance and the Minister for Puvblic Expenditure with the Troika," he said.


Read more: http://www.breakingnews.ie/ireland/kenny-income-tax-pledge-depends-on-imf-re-negotiation-521280.html#ixzz1YVVHdqmj

I think most people were expecting income tax not changing to be off set with taxes/stealth taxes else where. Now they are likely to do both. Its going to be a very tough budget again

average_runner

If they increase income tax they have to cut social welfare big time as otherwise it make it more attractive to families to give their jobs up and claim.

Hence increasing the costs for the country even more

godtabh

average_runner wrote: »

If they increase income tax they have to cut social welfare big time as otherwise it make it more attractive to families to give their jobs up and claim.

Hence increasing the costs for the country even more

That will never happen with Labour. Again another election ploy but one labour will fit for I would say

RichardAnd

I have heard that fuel tax will be going up. Petrol is already 1.55 at my local station, I could see it passing 1.60 easily. A petrol price like that is cyanide to a healthy economy because it will make people less likely to travel.

To hell with taxes, cut the waste.

thebman

godtabh wrote: »

That will never happen with Labour. Again another election ploy but one labour will fit for I would say

Really they were talking about it on some politics show the other night and there didn't seem to be any real opposition to it.

In fact quite the opposite, it was basically said that with welfare taking up that percentage of the budget, it will always be looked at for cuts.

invinciblePRSTV

godtabh wrote: »

Link
I think most people were expecting income tax not changing to be off set with taxes/stealth taxes else where. Now they are likely to do both. Its going to be a very tough budget again

Most people? definitely not. Why would anyone have expected income tax rates to remain the same when the state remains in its current difficulties?

Is it because some politician said it on the campaign trail?

lol

RichardAnd wrote: »

I have heard that fuel tax will be going up.

Where did ya hear that then?

RichardAnd

invinciblePRSTV wrote: »

Most people? definitely not. Why would anyone have expected income tax rates to remain the same when the state remains in its current difficulties?

Is it because some politician said it on the campaign trail?

lol



Where did ya hear that then?

I heard it originally on the radio some weeks ago, under the guise of "carbon tax", naturally. However, a quick google search revealed this:

http://namawinelake.wordpress.com/2011/07/30/budget-2012/

"An increase in the carbon tax", last line of the first segment. This would mean an increase in petrol tax so that we can stop the north pole from melting and the earth's climate from changing. Which, oddly enough, happened before humans got here at all....I wonder :rolleyes:

The Outside Agency

The melting of polar ice would be a good thing as there might be a lot of oil up there

femur61

Labour IMO is not really Labour, if the trade unions lived and worked by Jim Larkins original ideas the likes of Begg, O Connor and Geraty (sp) would not be living it up on in excess of €125,000/yr. We wouldn't have the highest social welfare in Europe, highest min wage, highest paid PS. We are only a small populated country we can't afford this luxeries. To make ends meet as a country with all these high wages income tax will have to be increased. it is disgraceful to see the headlines in the papers that county managers get €75,000 extra when they retire. Golden handshakes of €600,000 for top CS.

We elected the previous government so we've nobody to blame but ourselves.

The one thing that bothers me is Enda Kenny saying that his hands are tied, he has to give these sums of money because they were agreed, but we live in different times and we the ordinary citizens are paying the wages of the PS/CS.

beagle001

RichardAnd wrote: »

invinciblePRSTV wrote: »

Most people? definitely not. Why would anyone have expected income tax rates to remain the same when the state remains in its current difficulties?

Is it because some politician said it on the campaign trail?

lol



Where did ya hear that then?

I heard it originally on the radio some weeks ago, under the guise of "carbon tax", naturally. However, a quick google search revealed this:

http://namawinelake.wordpress.com/2011/07/30/budget-2012/

"An increase in the carbon tax", last line of the first segment. This would mean an increase in petrol tax so that we can stop the north pole from melting and the earth's climate from changing. Which, oddly enough, happened before humans got here at all....I wonder :rolleyes:

Ohh yes the changes Ireland adapts will surely reverse the damage and this new austerity is for a good cause,if every western nation reduces their carbon emissions it makes no real impact as Asia,Africa Brazil are increasing their emissions and are decades away from changing this.
It's another stealth tax by this u-turn government,wait and see this budget all the promises will be empty ones.
Labour and Fine Gael will blame the IMF and fianna failure for these new cuts " sure are hands are tied " unfortunately Kenny is too spineless to stick to his word.

fliball123

If Kenny goes ahead with this he will lose a fair % of his support..The reason I voted for him was his 2:1 of cutting vs taxes...if you increasing this Enda you need to look at PS PPP (Pay, Pension and Perks) and social welfare aswell..I find it demeaning that the likes of Bertie is still claiming expenses out of our taxes...and all PS who have retired in the last 5 years who contributed to this mess should have a 75% tax on their pensions on anything over 60k ...ala banker bonuse style...that gets by the our hands are tied sh1t...Be a man Enda and show some courage

liammur

fliball123 wrote: »

If Kenny goes ahead with this he will lose a fair % of his support..The reason I voted for him was his 2:1 of cutting vs taxes...if you increasing this Enda you need to look at PS PPP (Pay, Pension and Perks) and social welfare aswell..I find it demeaning that the likes of Bertie is still claiming expenses out of our taxes...and all PS who have retired in the last 5 years who contributed to this mess should have a 75% tax on their pensions on anything over 60k ...ala banker bonuse style...that gets by the our hands are tied sh1t...Be a man Enda and show some courage

We do need to increase taxes and cut welfare etc. But where I've lost all time for this govt is it seems we don't need to cut b ahern's massive expenses. I read he helped get a big contract for some developers in China. Probably over there on tax payer money.

This government is a complete sham. Socialism for berte et al, capitalism for the poor.

ei.sdraob

nivekd wrote: »

The melting of polar ice would be a good thing as there might be a lot of oil up there

Whatever happened to warm and wet winters we were promised courtesy of Global warming

liammur

ei.sdraob wrote: »

Whatever happened to warm and wet winters we were promised courtesy of Global warming

They will return.

The problem with global warming is, countries like Africa are getting hotter. Hence the term 'global'.

RichardAnd

ei.sdraob wrote: »

Whatever happened to warm and wet winters we were promised courtesy of Global warming

I believe they call it "climate change" now. I miss the old days, back then it used to be hot or cold and no one tried to relate either to lighting a gas fire

More spineless spin from the current govt and U-turns, if they can apparently take a stand against Europe on Corporation Tax then why is this so different? Another cop out from tackling the real problems like the PS pay and Social welfare costs..
They need to make the books balance but instead of tackling the difficult issues they will sell state assets and raise taxes whilst continually blaming FF and other factors, "our hands are tied, yak yak yak"

liammur

Well I agree with selling state assets, sell as many as possible.

so would I but only if the money is going to be put to good use... instead it will be used to pay off a bunch of useless *******

RichardAnd

liammur wrote: »

Well I agree with selling state assets, sell as many as possible.

I'm not so sure. Asset striping a country is just one of the many tricks used to impoverish a country already in dire straits. Take a country in need of cash, force them to sell an asset to you or one of your friends at a knock down price and then lease that asset back to the former owner.

sarumite

RichardAnd wrote: »

I'm not so sure. Asset striping a country is just one of the many tricks used to impoverish a country already in dire straits. Take a country in need of cash, force them to sell an asset to you or one of your friends at a knock down price and then lease that asset back to the former owner.

I am sure you can compare the price of a private company to that of a state asset. You can look at its revenue model, size, operating costs etc and judge appropriately. Does the government need a 25% stake in Aer Lingus?

godtabh

sarumite wrote: »

I am sure you can compare the price of a private company to that of a state asset. You can look at its revenue model, size, operating costs etc and judge appropriately. Does the government need a 25% stake in Aer Lingus?

It probably needed aer lingus when there was no alternative. does it need it now? Not at all.

As has been mentioned here already FG want to cut spending/reduce costs before increasing taxes.

Every one knows where these cuts/cost savings should be made. Some have been done but the fast majority of waste, fraud and inefficiencies have not be tackled.

liammur

RichardAnd wrote: »

I'm not so sure. Asset striping a country is just one of the many tricks used to impoverish a country already in dire straits. Take a country in need of cash, force them to sell an asset to you or one of your friends at a knock down price and then lease that asset back to the former owner.

Nobody is forcing them to sell anything at a knock down price. Put it on the open market and let the bids come in. The real winner will be the consumer as semi state bodies are by and large uncompetitive.

godtabh

liammur wrote: »

Nobody is forcing them to sell anything at a knock down price. Put it on the open market and let the bids come in. The real winner will be the consumer as semi state bodies are by and large uncompetitive.

Privatizations doesn't always work. Look at what happened in the UK after all.

Get rid of union influence and something might happen.

cyberhog

godtabh wrote: »

The Taoiseach has admitted that his promise not to increase income tax in the Budget is dependent on the say-so of the IMF.

...

in the Dáil he has admitted that it will be up to the EU and the IMF to allow the Government to fulfill that pledge.

Get used to it folks, we're going to be hearing a lot more of this from our politicians in the future.

femur61

Why are people surprised as I said in a previous post, do the math. It was because of Bertie and Lenihan (RIP) the IMF/EU are here so angry should be voiced at them. FG/L should have the honesty to say their hands are tied on lots of issues, but the unions sill hold a lot of power.

Victor

RichardAnd wrote: »

I have heard that fuel tax will be going up. Petrol is already 1.55 at my local station, I could see it passing 1.60 easily. A petrol price like that is cyanide to a healthy economy because it will make people less likely to travel.

While the government may take a large cut from the price of fuel, a lot of the money is still going out of the country. If people don't travel, they can spend the money locally.

Tea drinker

sarumite wrote: »

I am sure you can compare the price of a private company to that of a state asset. You can look at its revenue model, size, operating costs etc and judge appropriately. Does the government need a 25% stake in Aer Lingus?

Does the government need to reduce the profit from Aer Lingus by 75% ?
Maybe it never made a profit as the gov were too afraid of the unions / the management couldn't be bothered. That's not to say state and semi state can't be a profitable cash cow for the taxpayer. There just needs to be the political will and voter support for necessary reform.

If the gov feel that they could never reform them to a profitable enterprise then in certain circumstances it may be appropriate to sell the asset.

I also feel that a sort of fait accompli could be constructed in order to make it appear that the best thing is to sell an asset, this culd be done by vested interest from private parties in order to enrich themselves.

someone already pointed out UK as a failure, wasn't the rail system outsourced there, only to be insourced when the system began to collapse thru lack of investment? All these things can be manipulated to further enrich rich people. We already have a lot of talk for past couple of years how the water system is old and bad and needs to be outsourced to fix it.
What's the bets that following the sale the asset will be wound down to maximise profit and only token infrastructure projects completed... leading to a situation where it must be insourced again at huge cost as it is vital that the poor people of xyz have clean water for the babies?

We are quite a short term thinking country, and always build things small, then have to do it again at 3 times cost. e.g M50, dart, luas, port tunnel

of course the jewel in the PPP crown has to be the M50 tollbridge.
It cost something like 1.2 billion to buy back after generating hundreds of millions in revenue for the owner already this at a cost of :
1. Lost working/productive hours
80,000 cars per day, losing 1 hour (conservative half hour each way)
80,000 hours x 5 x 48 weeks = 19,200,000

http://nraextra.nra.ie/CurrentTrafficCounterData/html/M50-20.htm

times average industrial wage 15.6 per hour in 2006 = 299,520,000 per year in lost productivity on top of initial costs and

http://www.cso.ie/quicktables/GetQuickTables.aspx?FileName=QIJA.asp&TableName=Industrial+Earnings&StatisticalProduct=DB_QI

additional 1 litre of fuel per journey = 96000 per day = 23,040,000 per year
(1.2 euro rough average guestimate fuel cost)

= 322,560,000 cost to state per year to allow private guys to make a toll profit of (? euro) per year on the road the taxpayer paid for.
Followed by additional 1.2 billion to buy it out.
So what is the true, total cost to the Republic of Ireland ? 5 billion? Maybe 10 including the tolls?
Scary figures anyway, and this is what happens when you get PPP partnership wrong and should serve as a marker on PPP and outsourcing.

sarumite

Tea drinker wrote: »

Does the government need to reduce the profit from Aer Lingus by 75% ?

The government doesn't need to have anything to do with Aerlingus. The point of a government is not to make a profit, but to run services that would otherwise not be offered as they are not profitable (or at least shouldn't be run as a profit generating enterprises) or to ensure that services that are vital and necessary to the country are provided. Perhaps one time owning a commercial arline could be considerd necessary, but not any more.

Tea drinker

sarumite wrote: »

The government doesn't need to have anything to do with Aerlingus. The point of a government is not to make a profit, but to run services that would otherwise not be offered as they are not profitable (or at least shouldn't be run as a profit generating enterprises) or to ensure that services that are vital and necessary to the country are provided. Perhaps one time owning a commercial arline could be considerd necessary, but not any more.

But they have something to do with Aer lingus etc.... I'm talking about a long term commercial decision, not whether it's right a gov should or shouldn't own something. I am only concerend with $$$, not what current fashion (spouted by vested interests) says regarding State ownership.

sarumite

Tea drinker wrote: »

But they have something to do with Aer lingus etc.... I'm talking about a long term commercial decision, not whether it's right a gov should or shouldn't own something. I am only concerend with $$$, not what current fashion (spouted by vested interests) says regarding State ownership.

If that is the case, then why not just have the state own everything....therefore making as many €€€ as is needed. As someone with no vested interest in Aer lingus whatsoever, I do not believe the government needs to have sizeable stake in a company operating within a competive and open market. Thankfully at 25% the government cannot really assert its authority (I have lost faith in government run institutions in Ireland), yet if it doesn't have authority whats the point in maintaining ownership. Its not even as if its the only Irish company in the industry!!!!

fliball123

sarumite wrote: »

If that is the case, then why not just have the state own everything....therefore making as many €€€ as is needed. As someone with no vested interest in Aer lingus whatsoever, I do not believe the government needs to have sizeable stake in a company operating within a competive and open market. Thankfully at 25% the government cannot really assert its authority (I have lost faith in government run institutions in Ireland), yet if it doesn't have authority whats the point in maintaining ownership. Its not even as if its the only Irish company in the industry!!!!

I concur with this the semi states should be sold to the highest bidder ala ESB, CIE and the stake in aerlingus...keep a hold of one of the terminals, we own the roads and keep a hold of the elecy grid...and create new semi states without the back handers or high wages or crazy pensions and go to war with the old semi states...This would be great for the Irish consumer cheaper transport and electricity...

Tea drinker

sarumite wrote: »

If that is the case, then why not just have the state own everything....therefore making as many €€€ as is needed. As someone with no vested interest in Aer lingus whatsoever, I do not believe the government needs to have sizeable stake in a company operating within a competive and open market. Thankfully at 25% the government cannot really assert its authority (I have lost faith in government run institutions in Ireland), yet if it doesn't have authority whats the point in maintaining ownership. Its not even as if its the only Irish company in the industry!!!!

If WHAT is the case? the case is the State DOESN'T own everything - so we are talking about what exists - today - and how to make that work for us.
I'm not saying let's look at broaden the case for state ownership, however many people are talking about reducing the state ownership of assets - and failing to make a good or convincing case that I can really see the tangible benefits. No decision should be made until we have clear understanding. Why? because history teaches us we will lose as the facts are being hidden on purpose.

There are many many cases where state run institutions look abysmal, but my feeling is they could be vastly improved and have market level efficiencies is given the correct attention by the gov and the voting public.
Outsourcing doesn't fix this. Why? because the same employees (on the same contracts according to law) and more importantly - the same unions are involved.

I think the economic situation is vastly different than the boom years where too many people were hired by the State, and paid too well to do below par job. The thing is how to kickstart genuine reform? Will outsourcing really deliver this? How?

sarumite

Tea drinker wrote: »

If WHAT is the case? the case is the State DOESN'T own everything - so we are talking about what exists - today - and how to make that work for us.

I was referring to " I am only concerend with $$$, not what current fashion (spouted by vested interests) says regarding State ownership"

As such I thought we were talking about €€€.

Liam Byrne

invinciblePRSTV wrote: »

Most people? definitely not. Why would anyone have expected income tax rates to remain the same when the state remains in its current difficulties?

Because increasing income taxes reduces spending capabilities and therefore completely undermines any job creation initiatives....if people aren't spending, then shops won't sell, so they lay off staff.

Tea drinker

Liam Byrne wrote: »

Because increasing income taxes reduces spending capabilities and therefore completely undermines any job creation initiatives....if people aren't spending, then shops won't sell, so they lay off staff.

Two problems with your negativity to this proposal, it simply doesn't fit with the "Irish stimulus package"
1. we can just employ them in the Public service and pay them a huge wage as "that will go into the Irish economy"
2. We can put them on the dole and pay them well as that money "goes directly into the economy"

Back to reality....I think there may be a little wiggle room to pull another few hundred mill in income tax, but there is even more headroom for cutting our cloth to our measure. We have to balance the books by 2013? so surely the financial cataclysm that seems about to befall the world economy could be used as some sort of stick to beat the hell out of the Croke Park Agreement etc?

Selling the state assets in the middle of a depression might not be the best approach, sell low, buy high !

RichardAnd

Tea drinker wrote: »

Back to reality....I think there may be a little wiggle room to pull another few hundred mill in income tax, but there is even more headroom for cutting our cloth to our measure. We have to balance the books by 2013? so surely the financial cataclysm that seems about to befall the world economy could be used as some sort of stick to beat the hell out of the Croke Park Agreement etc?

Wasn't it extended to 2014 or 2015 as part of labour and FG's coalition? Also, it's not a case of balancing the books, the goal is to reducing borrowing to 3% of GDP. Whether we can maintain it at that level, well we'll see.

Dannyboy83

I have no doubt that taxes will go up; they don't have the balls to cut.

Then
Net incomes will fall -> Shops will close/Staff laid off -> Social Welfare bill will grow -> Mortgage defaults will rise -> More recapitalization -> domestic economy keeps contracting -> taxes will go up ->->-> Net incomes will fall -> Shops will close/Staff laid off -> Social Welfare bill will grow -> Mortgage defaults will rise -> More recapitalization -> domestic economy keeps contracting -> taxes will go up ->->-> Net incomes will fall -> Shops will close/Staff laid off -> Social Welfare bill will grow -> Mortgage defaults will rise -> More recapitalization -> domestic economy keeps contracting -> taxes will go up ->->->