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The Great Covid Divide

  • 05-04-2021 10:02am
    #1
    Registered Users Posts: 4,210 ✭✭✭ 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?


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Comments

  • Registered Users Posts: 26,407 ✭✭✭✭ 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


  • Registered Users Posts: 944 ✭✭✭ SnuggyBear


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

    Really?


  • Registered Users Posts: 10,644 ✭✭✭✭ snoopsheep


    Clearly neither position is in any way tenable tbh


  • Registered Users Posts: 5,763 ✭✭✭ 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.


  • Registered Users Posts: 5,763 ✭✭✭ growleaves


    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.


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  • Registered Users Posts: 17,299 ✭✭✭✭ 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.


  • Registered Users Posts: 3,845 ✭✭✭ Antares35


    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.


  • Registered Users Posts: 1,812 ✭✭✭ 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?


  • Registered Users Posts: 2,996 ✭✭✭ 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.


  • Registered Users Posts: 26,407 ✭✭✭✭ 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.


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  • Registered Users Posts: 57 ✭✭✭ 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.


  • Registered Users Posts: 2,996 ✭✭✭ 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.


  • Registered Users Posts: 7,061 ✭✭✭ Dr. Bre


    I’m alright Jack


  • Registered Users Posts: 23,190 ✭✭✭✭ 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?

    goodfellas-laughing-gif.gif


  • Registered Users Posts: 18,604 ✭✭✭✭ Akrasia



    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


  • Moderators, Society & Culture Moderators, Sports Moderators Posts: 26,577 Mod ✭✭✭✭ 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.


  • Registered Users Posts: 23,190 ✭✭✭✭ lawred2


    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


  • Registered Users Posts: 3,695 ✭✭✭ Loueze


    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.


  • Registered Users Posts: 4,308 ✭✭✭ woody22


    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)


  • Registered Users Posts: 4,366 ✭✭✭ jacdaniel2014


    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.


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  • Registered Users Posts: 3,845 ✭✭✭ 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 :D


  • Registered Users Posts: 17,299 ✭✭✭✭ 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.


  • Registered Users Posts: 3,845 ✭✭✭ 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.


  • Registered Users Posts: 5,763 ✭✭✭ 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.


  • Registered Users Posts: 1,373 ✭✭✭ 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.


  • Registered Users Posts: 23,190 ✭✭✭✭ 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?


  • Registered Users Posts: 1,665 ✭✭✭ Klonker


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


  • Posts: 0 ✭✭ [Deleted User]


    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?


  • Registered Users Posts: 17,299 ✭✭✭✭ 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.


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  • Posts: 0 ✭✭ [Deleted User]


    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.


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