The Great Covid Divide

Cluedo Monopoly

It strikes me that Covid has created a great divide in Ireland from a financial point of view.

Many people have lost out financially - lost jobs, lost income, lost businesses, lost savings etc...while many other people have benefited financially - increased income, lower costs, increased savings etc. I see the disparity in my own family circle.

It will be interesting what will happen when we have to start paying back the borrowings, balancing the books or paying to stimulate the economy. For example, will it be fair to tax people in the hospitality industry who were on PUP for a year the same rates as people who enjoyed working-from-home and built up their savings?

The people that did well financially will be mad keen to splurge when things open up while the people that struggled will just want to make ends meet again. The divide will be felt for many years. What other impacts will it have I wonder?

Eric Cartman

If anything it would be fairer that only the people on the PUP and employers taking TWSS had to pay it back , but ofcourse the burden will be shared with those of us who didnt take money from the state during this, ideally knowing Ireland where theres not a hope in hell of us cutting taxes , we roll it all in to cheap debt and just pay it back on the drip going forward

SnuggyBear

Eric Cartman wrote: »

If anything it would be fairer that only the people on the PUP and employers taking TWSS had to pay it back

Really?

Clearly neither position is in any way tenable tbh

growleaves

I think there's a misunderstanding on the part of the people who have supposedly benefited financially.

The deficits being run up now will make the whole country poorer and eat into the future income of everyone.

Some people have seen a very short term increase in savings, while at the same time savings rates have decreased yet again from an already very low base.

Now while that may not matter for people putting down deposits on a residence, paying back their mortgages may be more of a challenge than they expect since they could soon be facing depressed wages, increased taxes etc.

Also there will be more 'crises' in the future, as the precedent for sacrificing the economy in the name of safety has been set, and thus more instability leading to defaults.

growleaves

Eric Cartman wrote: »

If anything it would be fairer that only the people on the PUP and employers taking TWSS had to pay it back , but ofcourse the burden will be shared with those of us who didnt take money from the state during this, ideally knowing Ireland where theres not a hope in hell of us cutting taxes , we roll it all in to cheap debt and just pay it back on the drip going forward

Only if that had been announced beforehand, so that everyone would know that the government were forcing a million people onto welfare and also expecting them to re-pay it out of pocket.

Ace2007

growleaves wrote: »

Only if that had been announced beforehand, so that everyone would know that the government were forcing a million people onto welfare and also expecting them to re-pay it out of pocket.

Well a decent chunk of employers have repaid the TWSS, as they weren't entitled to it, and revenue will be checking the rest that claimed it.

Antares35

Cluedo Monopoly wrote: »

For example, will it be fair to tax people in the hospitality industry who were on PUP for a year the same rates as people who enjoyed working-from-home and built up their savings?

The people that did well financially will be mad keen to splurge when things open up while the people that struggled will just want to make ends meet again. The divide will be felt for many years. What other impacts will it have I wonder?

People who enjoyed working from home? We haven't been on annual leave, we've still been working, many of us harder than ever and with babies to mind and children to homeschool at the same time.

My guess is that the usual suspects, the middle earners, will be paying this bill for the rest of our lives. I doubt they will take anyone's PUP history into account. Why should they? If you're working, you pay.

Wesser

So youre proposing that the people who worked really hard for the pandemic including front line healthcare workers... myself included.... and put my health in dangers way......and paid income tax.... which was diverted to those who did not work... should now pay higher tax by way of punishment for working so hard during the pandemic? Are you having a laugh?

Padre_Pio

The people who will pay will be the people who have always paid.
Middle income earners who have been struggling for years.

Honestly I'm considering leaving Ireland if there's some big tax recoup coming in the next 12 months.

Wesser wrote: »

So youre proposing that the people who worked really hard for the pandemic including front line healthcare workers... myself included.... and put my health in dangers way......and paid income tax.... which was diverted to those who did not work... should now pay higher tax by way of punishment for working so hard during the pandemic? Are you having a laugh?

It wouldn't surprise me in the least if that's what was proposed.

Eric Cartman

Padre_Pio wrote: »

The people who will pay will be the people who have always paid.
Middle income earners who have been struggling for years.

Honestly I'm considering leaving Ireland if there's some big tax recoup coming in the next 12 months.



It wouldn't surprise me in the least if that's what was proposed.

This is it, but the issue is this has been a wake up call to the necessity of frontline workers , we were already losing medical staff before this due to high taxation and high cost of living , so im sadly predicting that the payback for this will be in a form of a new tax that doesn’t hit public sector workers. Itll be those who had to turn their kitchen into an office , who are about to have a mental breakdown , who have had their employer take this pandemic as an excuse for them to answer emails at 9pm and on saturdays etc.. who are forced to pay for this.

This will be used to further widen the lifetime earnings and pensions gap that gives public sector workers such security and privilege, and give a break to those PUP lower earners from having to pay this back.

is this username available

We are all going to pay for this. My guess is that there will be a ‘temporary’ Universal Health Charge similar to USC introduced.

To suggest taxing those who worked or did not work throughout the last two years is silly -it would be unconstitutional. No argument on that. The only lever they would have is threshold level.

If things get really bad then they could go after savings and pensions but that is a lesser possibility in my mind

No such thing as free money.

Padre_Pio

This COVID divide was flagged before.

The industries most affected by lockdown (retail, hospitality, tourism) are also the ones with the lowest earnings.

So people with little enough money have been earning even less money the past year, while those who can work from home have been saving like mad.

Dr. Bre

I’m alright Jack

lawred2

Wesser wrote: »

So youre proposing that the people who worked really hard for the pandemic including front line healthcare workers... myself included.... and put my health in dangers way......and paid income tax.... which was diverted to those who did not work... should now pay higher tax by way of punishment for working so hard during the pandemic? Are you having a laugh?

I agree but who else is going to pay?

The Multinationals?

Akrasia

is this username available wrote: »

No such thing as free money.

There actually is, the ECB has been offering (essentially) free money to governments for the past year to help tide economies over the pandemic
This money will be written off over time

Money is a financial instrument amongst many other financial instruments

The flow of money is what matters, not the actual number of ‘money’ in the global economy

As long as there is low inflation or even deflation, central banks can, and should increase the money supply

Turtwig

The people struggling the most pre covid will the ones most adversely impacted. Ironically some of these were probably working all during covid as well.

After that the biggest impact will probably fall on the hospitality and services sectors. Though it's hard to predict. Impact is a subjective thing as well. Someone just starting a career or business will likely be impacted much worse than someone well established.

lawred2

is this username available wrote: »

We are all going to pay for this. My guess is that there will be a ‘temporary’ Universal Health Charge similar to USC introduced.

To suggest taxing those who worked or did not work throughout the last two years is silly -it would be unconstitutional. No argument on that. The only lever they would have is threshold level.

If things get really bad then they could go after savings and pensions but that is a lesser possibility in my mind

No such thing as free money.

there is if you have a reserve currency and a central bank willing to print whatever it takes

Oh but wait, I thought "the young" were going to pay for it?

At least, thats all I've been hearing, for the last 12 months.

Padre_Pio

Padre_Pio wrote: »

This COVID divide was flagged before.

The industries most affected by lockdown (retail, hospitality, tourism) are also the ones with the lowest earnings.

So people with little enough money have been earning even less money the past year, while those who can work from home have been saving like mad.

And that will be largely offset by the fact that a high proportion of those working from home will be on higher wages than those working in, say, hospitality and therefore will foot most of the bill when the COVID levy is introduced (on top of the USC). My total deductions are close to 50% of my salary, and likely now to go up. So, yes, I have been WFH, have saved, and am in good shape, but I am also likely to be part of a cohort that ends up footing most of the bill for this

(The disincentive for me to work hard, when deductions are 50% is a debate for the tax forum)

People in general supported lockdowns so we can’t really complain about the mess ahead.

Yes there will be increased taxes and spending cuts.
Yes, the housing crisis will be worse as we shut construction when no other countries did.
Yes, the hospitals will be a bigger mess.
Yes, mental health will be much worse.
Yes, more people will be dying as a result of lockdown. ( Cancer screenings etc)
Yes, lots of children will have issues after so much missed school etc

Anyways, this is what people supported because they wanted to feel safer.

I’m happy knowing that I didn’t support this.

Antares35

Padre_Pio wrote: »

This COVID divide was flagged before.

The industries most affected by lockdown (retail, hospitality, tourism) are also the ones with the lowest earnings.

So people with little enough money have been earning even less money the past year, while those who can work from home have been saving like mad.

Saving like mad to put a roof over our childrens' heads. We weren't jetting off abroad to have our boobs reconstructed

Ace2007

The funny thing is that if Covid was over tomorrow and people could go anywhere on holidays - majority would be getting on a plane to someone nice - they wouldn't care less about the hospitality sector in Ireland being destroyed over the last year.

People moan about the economy and businesses being lost - but the same people are likely to buy stuff online because it's cheaper than their local shop for instance, or it's handier.

Antares35

Ace2007 wrote: »

The funny thing is that if Covid was over tomorrow and people could go anywhere on holidays - majority would be getting on a plane to someone nice - they wouldn't care less about the hospitality sector in Ireland being destroyed over the last year.

People moan about the economy and businesses being lost - but the same people are likely to buy stuff online because it's cheaper than their local shop for instance, or it's handier.

Good point.

growleaves

Ace2007 wrote: »

The funny thing is that if Covid was over tomorrow and people could go anywhere on holidays - majority would be getting on a plane to someone nice - they wouldn't care less about the hospitality sector in Ireland being destroyed over the last year.

The hospitality industry isn't reliant on native protectionism though. Presumably if things were thrown open they would get the same proportion of foreign and native custom as before and so would our EU neighbours and other friendly countries like US.

Barring the hospitality sector from trading is the real issue.

If they needed Irish customers then a patriotic publicity campaign could be organised.

Mr. Karate

Wesser wrote: »

So youre proposing that the people who worked really hard for the pandemic including front line healthcare workers... myself included.... and put my health in dangers way......and paid income tax.... which was diverted to those who did not work... should now pay higher tax by way of punishment for working so hard during the pandemic? Are you having a laugh?

These Lockdowns are costing us Billions a day. This has to be paid for at some point. And no doubt the Govt have already insulated themselves from paying for this [Otherwise they would have lost their love for lockdowns last year] The sad reality is that children not even born yet will be on the hook for this as well.

lawred2

Mr. Karate wrote: »

These Lockdowns are costing us Billions a day. This has to be paid for at some point. And no doubt the Govt have already insulated themselves from paying for this [Otherwise they would have lost their love for lockdowns last year] The sad reality is that children not even born yet will be on the hook for this as well.

what?

Klonker

Any chance of another raid of our pension funds? I'll actually have something to be raided this time :pac:

Padre_Pio

Padre_Pio wrote: »

Honestly I'm considering leaving Ireland if there's some big tax recoup coming in the next 12 months..

If you can afford to leave the country, it'd be a great time to move abroad for a few years. We've been living here for a little over two years now, and we are thinking about moving on.

Klonker wrote: »

Any chance of another raid of our pension funds? I'll actually have something to be raided this time :pac:

It'll be saving, second homes, and bedroom taxes this time round. People seem to think that the country is going to spring back into a boom, once NPHET decides that the country can be re-opened fully. That isn't going to happen, and consequences of the pandemic are going to become clear on an individual, local and national level. Can't wait to see how the banks get on when people start defaulting on loans. Could you have another banking collapse, and another bailout from the tax payer?

Ace2007

tara2k wrote: »

If you can afford to leave the country, it'd be a great time to move abroad for a few years. We've been living here for a little over two years now, and we are thinking about moving on.

It'll be saving, second homes, and bedroom taxes this time round. People seem to think that the country is going to spring back into a boom, once NPHET decides that the country can be re-opened fully. That isn't going to happen, and consequences of the pandemic are going to become clear on an individual, local and national level. Can't wait to see how the bank get on when people start defaulting on loans. Could you have another banking collapse, and another bailout from the tax payer?

Just as well the Central bank have been strict about what banks can lend, if some on here or in opposition had their ways, it could be just like 2008 all over again - people way in over their heads with debt.

I look forward to hearing SF's alternative budget going forward to get out of this mess - they are all for throwing money at people - but very rarely do they show how they will pay for me. I suspect if there was an election called in the morning, SF would strategically decide their runners, so that they would not be the sole/largest party in power, as they will under no circumstances want to deal with having to pay for all this in the years to come.

Ace2007

Ace2007 wrote: »

Just as well the Central bank have been strict about what banks can lend, if some on here or in opposition had their ways, it could be just like 2008 all over again - people way in over their heads with debt.

That decision might end up saving the country. I'm not sure where you'll end up if you end up with another banking collapse.

Ace2007 wrote: »

I look forward to hearing SF's alternative budget going forward to get out of this mess - they are all for throwing money at people - but very rarely do they show how they will pay for me. I suspect if there was an election called in the morning, SF would strategically decide their runners, so that they would not be the sole/largest party in power, as they will under no circumstances want to deal with having to pay for all this in the years to come.

I deal with them, and all of the major political parties, as part of my job. I'd stay if they did went into government. It'd be comedy gold, like Trump of meth.

Wesser

Wesser wrote: »

So youre proposing that the people who worked really hard for the pandemic including front line healthcare workers... myself included.... and put my health in dangers way......and paid income tax.... which was diverted to those who did not work... should now pay higher tax by way of punishment for working so hard during the pandemic? Are you having a laugh?

That's exactly what's going to happen, except we all will pay higher taxes, and there will be pay cuts too. Think 2009 on steroids.

Mr. Karate

Mr. Karate wrote: »

These Lockdowns are costing us Billions a day. This has to be paid for at some point. And no doubt the Govt have already insulated themselves from paying for this [Otherwise they would have lost their love for lockdowns last year] The sad reality is that children not even born yet will be on the hook for this as well.

More like 2 billion a month give or take half a billion. A children's hospital a month.

Deleted User

Deleted User wrote: »

That's exactly what's going to happen, except we all will pay higher taxes, and there will be pay cuts too. Think 2009 on steroids.

By all, I presume you tax payers right? No party in Ireland is going to cut welfare.

growleaves

Ace2007 wrote: »

Just as well the Central bank have been strict about what banks can lend, if some on here or in opposition had their ways, it could be just like 2008 all over again - people way in over their heads with debt.

I look forward to hearing SF's alternative budget going forward to get out of this mess - they are all for throwing money at people - but very rarely do they show how they will pay for me. I suspect if there was an election called in the morning, SF would strategically decide their runners, so that they would not be the sole/largest party in power, as they will under no circumstances want to deal with having to pay for all this in the years to come.

They're not the only ones though, are they? We are running up large deficits right now. FF and FG could teach SF a thing or two about throwing money at people.

Cluedo Monopoly

Klonker wrote: »

Any chance of another raid of our pension funds? I'll actually have something to be raided this time :pac:

I cant remember what they took from our pensions the last time. Was it 0.8% or something?

Ace2007

growleaves wrote: »

They're not the only ones though, are they? We are running up large deficits right now. FF and FG could teach SF a thing or two about throwing money at people.

No but if you are led to believe what the anti government posters are saying - then FF/FG won't be in power after the next election - that only leaves SF as viable option - and they aren't one to impose tax increases - it will go against everything that they have said over the last number of years.

How will SF deal with paying for all this and somehow convince Irish people that having a United Ireland is economically going to work? Mary Lou seems to talk a lot about a united Ireland - it's like this is what she cares about most - and forget about anything else.

Ace2007

Cluedo Monopoly wrote: »

I cant remember what they took from our pensions the last time. Was it 0.8% or something?

0.6% for first 3 years, 0.75% for 4th more and then 0.15% for the last year

growleaves

growleaves wrote: »

They're not the only ones though, are they? We are running up large deficits right now. FF and FG could teach SF a thing or two about throwing money at people.

All of the parties support what FF and FG are doing.

Antares35

tara2k wrote: »

If you can afford to leave the country, it'd be a great time to move abroad for a few years. We've been living here for a little over two years now, and we are thinking about moving on.



It'll be saving, second homes, and bedroom taxes this time round. People seem to think that the country is going to spring back into a boom, once NPHET decides that the country can be re-opened fully. That isn't going to happen, and consequences of the pandemic are going to become clear on an individual, local and national level. Can't wait to see how the banks get on when people start defaulting on loans. Could you have another banking collapse, and another bailout from the tax payer?

Yup, some people have bought this whole narrative they've spun about "pent up consumer demand" springing us into the glory days again. As if a million people descending on Penney's for knickers and pjs will be enough to offset a 28 billion euro hole.

TheDriver

Wait until they propose cutting public service pay and hence the nurses that were so valued this time last year

Nobody should have to repay a cent.
Not there fault the government has made a total and utter balls of the situation from the start.
Government forced to close so I believe they should be picking up the Tab.
Let those in nephet and the rest of the HSE decision makers pay first starting ASAP.

Antares35

Antares35 wrote: »

Yup, some people have bought this whole narrative they've spun about "pent up consumer demand" springing us into the glory days again. As if a million people descending on Penney's for knickers and pjs will be enough to offset a 28 billion euro hole.

Good point. We were talking about this in work last week. People were saying that they have grown out of the habit of going to the pub, spending €3 for a cup of coffee every day, going out for a meal at the weekend etc now, and they are not going to start doing it again once country opens back up. Think they've also realised how much money they were wasting on the above. The lockdown has gone on for so long now that people have changed their approach to life.

growleaves

tara2k wrote: »

All of the parties support what FF and FG are doing.

Yes but the fact is that FF and FG are the ones who are literally doing it - they are forcing people onto welfare and running up huge deficits.

So getting angry that SF would theoretically run up deficits and preferring FF and FG because they theoretically would not do so is farcical.

Ace2007

Ace2007 wrote: »

0.6% for first 3 years, 0.75% for 4th more and then 0.15% for the last year

Having done it once, and crossed that line, I would not be surprised if there is another raid on pensions, and a demand to all pension fund managers to disclose our pension details to the government.

I don’t recall it being that much though. My recollection is that it was a one off of c 1%

cerateau

A ridiculous amount of students have been claiming the payment since March last year. I don't blame them however, how is it fair to give thousands of euros to students, many of whom have no intention of staying here and the majority of whom haven't paid income tax.

To foot the bill, the government should tackle these students by maybe taking the grant off students who claimed benefits?

Anyone on the dole for more than a year, with limited exceptions, will have their payment reduced to food vouchers.

Anyone who has been in employment throughout the year should be given tax breaks. We're not the enemy

tommybrees

tommybrees wrote: »

Nobody should have to repay a cent.
Not there fault the government has made a total and utter balls of the situation from the start.
Government forced to close so I believe they should be picking up the Tab.
Let those in nephet and the rest of the HSE decision makers pay first starting ASAP.

Late last year, if I remember correctly, Pascal O' Donoghue said that those who benefited most from the pandemic should pay. I'd be very interested to find out who these people are. He can't be referring to the people who've continued to work during the pandemic. The efforts of those people has helped keep some semblance of respectability on the finances of the state, and they've been treated like convicts, and scolded like little children, in return.

Ace2007

Deleted User wrote: »

Having done it once, and crossed that line, I would not be surprised if there is another raid on pensions, and a demand to all pension fund managers to disclose our pension details to the government.

I don’t recall it being that much though. My recollection is that it was a one off of c 1%

As bad as a raid on pensions sound, if your saving for retirement, there is no better way of doing it forma tax efficient point of view.

If the government raided bank savings for instance well this is money that's already being taxed, hit with DIRT and quite soon could be hit with negative interest rates. So all in all you probably prefer it to be taking from pension.

Also don't think it really affects the PS - as they all on DB type pensions so there wasn't a majority outcry. If the government really wanted to saved money - stop the future accrual to public sector pensions and move them all to DC type pensions - this would saved the government billions in the long run - but the unions will never let that happen.

PintOfView

Eric Cartman wrote: »

If anything it would be fairer that only the people on the PUP and employers taking TWSS had to pay it back , but ofcourse the burden will be shared with those of us who didnt take money from the state during this, ideally knowing Ireland where theres not a hope in hell of us cutting taxes , we roll it all in to cheap debt and just pay it back on the drip going forward

So are you saying you were out of work, but decided not to take money from the State?

I consider myself very lucky to have been able to work from home, and would be happy to have paid extra tax this past year, and in the future if necessary, to help those a lot more affected by this than me.

We're all in this together, and we need to all pull together to get the country back on its feet.
I can't see how your me fein attitude will make any positive contribution to what we need to do.

cerateau

PintOfView wrote: »

We're all in this together, and we need to all pull together to get the country back on its feet.
I can't see how your me fein attitude will make any positive contribution to what we need to do.

How many employers are having the time of their lives right now with the TWSS ?
How many of those on PUP are doing a nixer?

When you punish those who contribute most, you make this island a very undesirable place to live.

The government should not have enforced these restrictions if they had no funds to do so. Poorer countries carried on as normal, something we should have done a long time ago.

PintOfView

PintOfView wrote: »

We're all in this together, and we need to all pull together to get the country back on its feet. I can't see how your me fein attitude will make any positive contribution to what we need to do.

You cannot be serious. We are not in this together. Some people are having the times of their lives right now, working cash in hand, and collecting payments from the state. I know a hairdresser who doesn't want this to end, and she is planning on working on the black market for as long as possible. Others, like you, are keeping the show on the road, to a certain extent, and some people are going to lose everything they've worked for.