IBEC's Latest Muppetry

geeky

Those smart folks at IBEC have opened their pie hole again.
http://www.rte.ie/news/2011/0929/ibec-business.html [full article below]

TL;DR Version: They Want pension law changed so that people can draw down their pension paying only 20% tax. What a load of cobblers. 'Yes, let's help the richest people in the state [those paying the higher rate and able to set aside a significant amount as AVCs] by taxing them like they're a low earner. that sounds like a sensible, fair approach.'
Meanwhile, they want to make Child Benefit like food stamps, only with a costly, gimmicky 'electronic payment card' system that people can only use to pay for goods or services. Riddle me this, IBEC: will parents be able to buy nappies in Lidl or Aldi with this wonderful card? Last time I checked, they only take laser. Should Corner shops get expensive new equipment? Who benefits from that?

My Question: are these people utterly shameless or just stupid?

Employers' organisation IBEC has proposed a number of measures aimed at boosting spending in the domestic economy.
In a pre-Budget submission published today, IBEC says conventional policy responses will not be enough to deal with the unemployment and public debt problems the country faces.
It says governments have spent the past few years concentrating on the Budget problem, but must now urgently spell out an economic growth strategy.
IBEC says the commitments to economic reform contained in the EU-IMF programme should be regarded as the bare minimum necessary, and more ambitious plans are needed to address the cost of doing business, labour markets, social welfare, and public sector efficiencies.
While the export side of the economy is doing well, the domestic economy is still contracting, and IBEC proposes a number of measures it believes will boost spending in the local economy.
It calls for a strong Government communications strategy to counteract what it regards as inaccurate and misleading claims about the economy made by domestic and international commentators, which it claims are undermining confidence among consumers leading them to spend less and save more than is normal.
IBEC also wants pension law to be changed to allow people with personal pension plans or who have made significant additional voluntary contributions (AVCs) to be allowed to draw down up to 25% of their personal plan or AVC contributions to spend now. The money drawn down would be taxed only at the 20% standard rate.
This would give some money to the Government up-front, but would represent a long-term tax loss. It is hoped this would be somewhat offset by using the money now, either to pay down debts or to spend.
The measure would mainly relate to business people who have undergone changed circumstances as a result of the collapse. IBEC regards this as a way of using some of the large stock of national savings - around €70 billion in pension funds - most of which is invested outside of the State.
IBEC also wants to push more of the €2.2 billion of child benefit payments into the economy by encouraging the spending rather than saving of this money. It proposes the payment of child benefit through an electronic payment card that can be used only to buy goods and services. This means that many upper income families in receipt of the benefit cannot save it directly, but must spend. Because the card works only in the State, it reduces the amount repatriated abroad (only around €15m annually according to IBEC).
It says people who do not want to accept the electronic payment card could continue to receive cash transfers, but would have to take a 25% cut in the amount they receive. The value of the total child benefit sum paid by the state is approximately 3% of consumer spending, which is the biggest single component of the economy.
IBEC also wants a home improvement tax credit - a tax incentive for people to get improvements made to their homes, which is a labour intensive industry. As this is a tax-based measure, it would work against the development of the informal or black economy in home repairs (nixers) so could be revenue neutral.
IBEC claims a 30% increase in home improvements could generate 4,000 jobs and yield about €100m to the Exchequer. Using a similar scheme in Canada as a template, IBEC suggests a three-year tax scheme, giving a 20% refundable tax credit on works valued between €3,000 and €20,000 carried out by tax compliant contractors.
The employers' group also proposes a series of measures to stimulate property transactions, aimed at increasing the number of property sales, not increasing the price of property.
At the moment there are about 10,000 property sales a year, but the normal rate is about 40,000 a year, according to IBEC, a level of transactions it believes would generate about €600m for the domestic economy. To boost sales, it proposes a two-year window of opportunity by exempting homes bought before the end of next year from any new property tax for the following six years. For homes bought in 2013, the exemption would be for three years.
Other proposals include pre-announcing an increase in stamp duty on house purchases to 2% in 2013 and 3% in 2014, allowing a tax-free drawdown from pension funds of up to 10% of fund value for house purchase and immediately rolling out a national house price register.
On the public finances, IBEC is opposed to a Budget adjustment that goes beyond the €3.6 billion already agreed to in the EU-IMF plan. It says there is no need to impress bond markets, from whom we are not borrowing, by accelerating austerity. It says markets already accept that Ireland is implementing an austerity plan - the priority now is economic growth, and the Budget should be fine-tuned to deliver that.
IBEC says the bulk of the adjustment should come in the form of spending cuts, rather than tax increases. It wants to see cuts of €2.7 billion and tax rises of €900m - a three to one ratio. It says there should be no increase in income tax of any kind - instead the tax base should be widened by increasing the number of State services charged for, and through residential property tax.
For businesses it wants to see changes to the treatment of Research and Development tax credits, and the introduction of an "innovation box" regime for the taxation of intellectual property at a rate of 5%.
It would also like some changes to the income tax regime to make Ireland more attractive for key individuals who have to be recruited from abroad for firms based here, saying Ireland now has the fifth highest personal income tax regime in the EU for people earning above the average wage.
It says local authority charges are excessive and vary widely between local authorities. It wants to see local authority charges cut by 25%, with the shortfall recouped through greater efficiencies in local authorities, and secondly by local taxes and charges.
On employment and welfare reform, IBEC says it welcomes the recent reports from the Department of Social Protection on a single working age payment, and on the integration of employment and entitlement services (NEES), which includes a detailed timeline for implementation up to May of next year.

stephen_k

Sorry but even the TL;DR is TL;DR....

geeky

Fair enough!

new dl;dr version: are IBEC shameless or idiots?

orourkeda

geeky wrote: »

Fair enough!

new dl;dr version: are IBEC shameless or idiots?

tldr

Zebra3

geeky wrote: »

Fair enough!

new dl;dr version: are IBEC shameless or idiots?

Shameless.

Like a load of other groups in the country, they're out to look after themselves.

However it is time childrens allowance was means tested and there should be no payments beyond two kids.

Pherekydes

Zebra3 wrote: »

However it is time childrens allowance was means tested and there should be no payments beyond two kids.

Don't they need women to have more than two kids each?

geeky

orourkeda wrote: »

tldr

IBEC = w*nkers. Discuss.

geeky

Zebra3 wrote: »

However it is time childrens allowance was means tested.

That's true - or taxed. It's a blunter instrument than a means test, but less hassle in terms of organisation. But of course, either those proposals would actually hit rich people in the pocket....

thebigbiffo

IBEC IN REPRESENTATIVE BODY RESPRESENTING A BODY SHOCKER.

mikemac

tax credits for builders and tax exemptions for house sales

Have we learned nothing from government interference and using taxpayers money on the property market?

opinion guy

Remind me again - why is it that small business need a union in the first place ? Being abused by their minimum wage employees/interns is that it ?

atila

How would you prompt spending in an economy with such a high savings rate in certain subsets of the population?

Why not rebalance the tax code in such a way that those well enough off to consume more goods and services are encouraged to create the demand that creates jobs for people.

Currently people with a healthy houshold budget are stockpiling cash out of fear and have no push to put their money to work as a result of low inflation rates and a deflationary enviornment.

geeky

opinion guy wrote: »

Remind me again - why is it that small business need a union in the first place ? Being abused by their minimum wage employees/interns is that it ?

3 or four unions, as a matter of fact.

@ Biffo, I don't have a problem with an organisation representing the interests of small business. But effectively forcing every business in the country to accept this daft payment method ain't representing small business. And it'd be nice if they pushed for stuff that was even subtle in its efforts to preserve well-feathered nests.

thebigbiffo

opinion guy wrote: »

Remind me again - why is it that small business need a union in the first place ? Being abused by their minimum wage employees/interns is that it ?

IBEC do a very important job imo - they represent the interests of the biggest employer in the country: the small business owner. yeah, for all the wages monkeys out there they're just representing 'the man' but, in keeping with begrudging, bitter attitude of most of irish society, they fail to see the bigger picture.

geeky

thebigbiffo wrote: »

IBEC do a very important job imo - they represent the interests of the biggest employer in the country: the small business owner. yeah, for all the wages monkeys out there they're just representing 'the man' but, in keeping with begrudging, bitter attitude of most of irish society, they fail to see the bigger picture.

That rich people should pay less tax?

Just for info, I'm a small business owner and I think they're just a con-job, quite frankly. They take the money of businesses, supplement it with some government grants, and spout stuff that appeals to people with absolutely no sense of social solidarity.

mikemac

thebigbiffo wrote: »

IBEC do a very important job imo - they represent the interests of the biggest employer in the country: the small business owner.

I thought that was ISME, no?

I always thought IBEC tended to represent the huge employers with hundreds of staff

Gummy Panda

Wait.. are IBEC asking for people to be able to draw down some of their pension now with little penalty to inject money into retail for Xmas?

geeky

Gummy Panda wrote: »

Wait.. are IBEC asking for people to be able to draw down some of their pension now with little penalty to inject money into retail for Xmas?

Yes, in a nutshell. Because of course, we don't have long-term pension funding problems already.

lempsipmax

In terms of forcing the Child Benefit to be spent. Surely people who wished to save it would just spend it on the card and save the equivalent amount from their income. It would just create a loophole which was so easy to get through it would be almost pointless. Equally it would deprive the banks of deposits it gets from saved child benefit.

mikemac

Ah IBEC, want to lecture on welfare reform and giving people electronic cards and 25% cuts while asking for tax write-offs for people with large pensions and tax credits for businesses. :rolleyes:

Child Benefit should be looked at but not because IBEC wants it done

Gummy Panda

geeky wrote: »

Gummy Panda wrote: »

Wait.. are IBEC asking for people to be able to draw down some of their pension now with little penalty to inject money into retail for Xmas?

Yes, in a nutshell. Because of course, we don't have long-term pension funding problems already.

It's a good idea in a way but i don't know where they think the pension funds are going to get the available cash to draw down.

geeky

lempsipmax wrote: »

In terms of forcing the Child Benefit to be spent. Surely people who wished to save it would just spend it on the card and save the equivalent amount from their income. It would just create a loophole which was so easy to get through it would be almost pointless. Equally it would deprive the banks of deposits it gets from saved child benefit.

I hadn't even thought of that. Wow, just wow.

RATM

thebigbiffo wrote: »

IBEC do a very important job imo - they represent the interests of the biggest employer in the country: the small business owner. yeah, for all the wages monkeys out there they're just representing 'the man' but, in keeping with begrudging, bitter attitude of most of irish society, they fail to see the bigger picture.

Not really to be honest- ISME and the SFA represent small businesses.


IBEC are by an extension of the banks, their main funding comes from them and the big consultancy firms. Shane Ross writes about the relationship between IBEC and the banks extensively in his book The Bankers. Banks don't want you to know that IBEC is their lobbying arm but Ross manages to de-bunk that by drawing dozens of links between the two.

StudentDad

geeky wrote: »

lempsipmax wrote: »

In terms of forcing the Child Benefit to be spent. Surely people who wished to save it would just spend it on the card and save the equivalent amount from their income. It would just create a loophole which was so easy to get through it would be almost pointless. Equally it would deprive the banks of deposits it gets from saved child benefit.

I hadn't even thought of that. Wow, just wow.

Oh I'm sure they have a list of 'approved oirish businesses' to try and rope people into spending their CB in the 'right' shop. None of this taking the money over the border nonsense. Esp. with Xmas coming up.

SD

opinion guy

thebigbiffo wrote: »

IBEC do a very important job imo - they represent the interests of the biggest employer in the country: the small business owner. yeah, for all the wages monkeys out there they're just representing 'the man' but, in keeping with begrudging, bitter attitude of most of irish society, they fail to see the bigger picture.

Bull****. They are a lobby group for people who already have power and influence.

sock puppet

lempsipmax wrote: »

In terms of forcing the Child Benefit to be spent. Surely people who wished to save it would just spend it on the card and save the equivalent amount from their income. It would just create a loophole which was so easy to get through it would be almost pointless. Equally it would deprive the banks of deposits it gets from saved child benefit.

On the first point, maybe but people aren't always that rational. Though surely you could achieve a similar outcome by just forcing people to take their payments in cash?

The_Thing

IBEC are nothing more than a bunch of whineing slave drivers with a race-to-the-bottom agenda.

Big Nasty

lempsipmax wrote: »

In terms of forcing the Child Benefit to be spent. Surely people who wished to save it would just spend it on the card and save the equivalent amount from their income. It would just create a loophole which was so easy to get through it would be almost pointless. Equally it would deprive the banks of deposits it gets from saved child benefit.

Yes, but it would also mean that those claiming child benefit for kids out of state would have to spend the money here not send it back to Poland (or wherever).

geeky

MCMLXXV wrote: »

Yes, but it would also mean that those claiming child benefit for kids out of state would have to spend the money here not send it back to Poland (or wherever).

If that's the objective, why not just make it a payment for resident children in the state? And why not bloody say so?

geeky

geeky wrote: »

Meanwhile, they want to make Child Benefit like food stamps, only with a costly, gimmicky 'electronic payment card' system that people can only use to pay for goods or services. Riddle me this, IBEC: will parents be able to buy nappies in Lidl or Aldi with this wonderful card? Last time I checked, they only take laser. Should Corner shops get expensive new equipment? Who benefits from that?

My Question: are these people utterly shameless or just stupid?

That's actually not a bad idea and I'm sure it could be made operate like a Laser card therefore any shop could take it. In fact if a person has never worked then why not extend this system to all people who claim state benefits. Why should our tax money be spent on alcohol, drugs or gambling etc!