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General Irish Government discussion thread [See Post 1805]
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Sam Russell wrote: »Having a 30%/30%/40% split between social/affordable/normal housing should be a good mix.
the social and affordable should be built to the same spec - basic but good quality. The normal houses would be built to a higher spec with larger rooms and better quality finish, but not widely so.
If say cost of build is €200k for the first two plus site, with the second costing €250k plus site. Say site cost from Nama is €50k, then the cost to the state would be reasonable, given that they get back the VAT plus payroll tax. Overall, if DCC is the developer, there is no profit to add, and the prices could come out as €250k for the first two, with the second and third group selling for
€295 and €395k (to €495 - depending on demand) respectively,
Now these figures are representative and figurative, but could be wildly out, but the extra €100k per house for the last group would significantly subsidise the first two groups. [Remember, if DCC do the development, there is no profit for private pockets].
The numbers you are using are not the ones I suggested.Of course it is free money. Let us look again at Sam Russell's example.
House costs 350k for a normal couple buying the house.
House costs 200k for a couple eligible for affordable housing.
Ten years later, houses are worth 400k. One couple pockets a profit of 50k, the other couple pockets a profit of 50k, plus a free handout from the taxpayer of 150k. That is an average of 15k a year after tax of a handout, basically a handout of 30k a year that Couple 1 would have to earn to keep up with Couple 2.
To me, that is too much of a subsidy to hand out. Stretch the length of time to 15 or 20 years and/or tax/recoup the subsidy element when the house is sold.
Type A houses cost 250K inc site cost. Rents to scial tennant and sells to affordable qualified purchaser for 295k.
Type B houses cost 300k inc site cost and sell for 395k, which is the market price, or higher if that is attainable. A 100k extra for a house that costs 50k extra to build is not a huge difference. Maybe the Type B are detached rateher than semi, or they ae 4 bedroom rather than 3 bedroom, or other differences.
No free money because affordables are sold subject to conditions that would prevent profits being made for at least 10 years.
Now these are back of the envelope numbers, but should convey the idea, and certainly are not intended to allow people to get free money.0 -
Matt Barrett wrote: »The state is feeding the crisis, never mind effectively tackling it. Supplying cheap properties for private concerns to rent back to the state. Cheap NAMA loans and buying properties off the market at the going rate for use as social housing.
Affordable housing is a great solution for those earning too much to avail of social housing and too poor to buy off market.
I would suggest a similar model to any social housing estate. Modest housing in smaller numbers than the sprawling estates of old throughout the cities and out skirts, ensuring access to amenities, schools, shopping.
I don't think one off affordable housing would work nor a small number mixed into a private estate of similar properties.
It makes more financial sense for the state/LA's to provide affordable housing or social housing with affordable rents, than it does to go through HAP or buyers grants IMO. If it's about value for the tax payer, the current model does not give it. We need to get over the 'forever home' mantra as cutting our nose to spite our face is costing us.
Matt, I've been ever so impressed with how you continually batter back. I'm generally Inn agreement with you.
Can someone please answer me why we were able to build vast swathes of social housing all around the country through the 40s, 50s, 60s and 70s. Then again through PPP and housing coops in the nineties and noughties but now we just have to accept the ludicrous market-led situation we have now?
It boggles the mind.
Housing yet again is destroying the country. And it's privately and profit led.0 -
BonnieSituation wrote: »Matt, I've been ever so impressed with how you continually batter back. I'm generally Inn agreement with you.
Can someone please answer me why we were able to build vast swathes of social housing all around the country through the 40s, 50s, 60s and 70s. Then again through PPP and housing coops in the nineties and noughties but now we just have to accept the ludicrous market-led situation we have now?
It boggles the mind.
Housing yet again is destroying the country. And it's privately and profit led.
Too many houses once and too few houses now.
The market adjusted then and would now too if left alone.
In the 40s, 50s, 60s and 70s that's what happened.
The State/LAs can build all the houses they want - provided they pay for them.
Social welfare takes 30% of the budget excl houses. If we are to spend vast amounts of money on housing, money on social welfare will have to be cut back or taxes raised or both (preferably).
This was not the case in those earlier decades - that is SW took much less then and Govt could afford the social housing.0 -
Do you have any actual proof that their margin is higher than 8% because that is what a number of developers have stated publicly?
Also, DCC would be nowhere as efficient as a developer in tendering out contracts to developers/builders. They would also need to raise finance unless it was just given to them by the government. Then, there would be the issue of state aid and competition law.
Sure, they do not have the profit motive but they don't have the efficiency motive either which can cost more holistically.
I see some stuff bandied about that LA's would be able to build houses for peanuts but little in the way of actual proof that this can be achieved.
The only way I see that its possible is that they use public land.
Absolutely correct. Sums the situation up perfectly.0 -
It will be interesting to see if this makes the budget.
The usual suspects expected to carry the can again!
https://m.independent.ie/business/personal-finance/tax-plan-to-hit-squeezed-middle-for-extra-250-37227765.html0 -
Probably their usual kite flying. Put simply, don’t hike the already unjustifiable welfare rates. Then incone taxes can be left as are or reduced. Living standards of many workers are going down, to pay for the most comfortable in society ... pensioners and those welfare thief’s like ms cash. Probably has No debt, no job, guaranteed income!0
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Actually I couldn’t keep up with Leo the liar and his five million spin unit. This is probably a smoke screen, no tax hikes but minuscule reductions in the budget and everyone will breath a sigh of relief! This is the problem when there is no competition, all the parties tripping over themselves for the pensioners and welfare vote! And that’s why they can get away with it, because there is no alternative the public deem viableIt will be interesting to see if this makes the budget.
The usual suspects expected to carry the can again!
https://m.independent.ie/business/personal-finance/tax-plan-to-hit-squeezed-middle-for-extra-250-37227765.html0 -
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Idbatterim wrote: »Actually I couldn’t keep up with Leo the liar and his five million spin unit. This is probably a smoke screen, no tax hikes but minuscule reductions in the budget and everyone will breath a sigh of relief! This is the problem when there is no competition, all the parties tripping over themselves for the pensioners and welfare vote! And that’s why they can get away with it, because there is no alternative the public deem viable
Cut out the petty name calling.The foreigner residing among you must be treated as your native-born. Love them as yourself, for you were foreigners in Egypt. I am the LORD your God.
Leviticus 19:34
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Idbatterim wrote: »Actually I couldn’t keep up with Leo the liar and his five million spin unit. This is probably a smoke screen, no tax hikes but minuscule reductions in the budget and everyone will breath a sigh of relief! This is the problem when there is no competition, all the parties tripping over themselves for the pensioners and welfare vote! And that’s why they can get away with it, because there is no alternative the public deem viable
Yeah it's all Leo:Indo wrote:Fianna Fáil frontbencher Willie O'Dea has already called for an extra €5 a week to be paid on the State pension.0 -
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Just reading the Sunday indo now in a friends house. They won’t get get a cent from me. The journalist think fg are trying to get ff to pull plug on the supply and confidence and go for an election. Fg should play hard ball on welfare or refuse increases to those in JSa or jsb at a minimum, even though they have no interest in the taxpayer, it would certainly look like they do and back up Leo’s comedies claim of representing the early risers ...
Pulling the plug now when they probably won’t go any higher and using the excuse of unsustainable welfare to do it. Jesus if they had any balls or sense they’d do it ...0 -
BonnieSituation wrote: »Yeah it's all Leo:
Willie apparently makes the same calls every year around budget time so come election time he can call to pensioners doors and show off to them0 -
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Good loser wrote: »Too many houses once and too few houses now.
The market adjusted then and would now too if left alone.
In the 40s, 50s, 60s and 70s that's what happened.
The State/LAs can build all the houses they want - provided they pay for them.
Social welfare takes 30% of the budget excl houses. If we are to spend vast amounts of money on housing, money on social welfare will have to be cut back or taxes raised or both (preferably).
This was not the case in those earlier decades - that is SW took much less then and Govt could afford the social housing.
I don't believe the public coffers were over flowing in the 1930's. If we can find money to exacerbate the housing crisis we can surely find it to quell it's growth, if the will was there.
Yet we'd need spend less on Social Protection and interfere with the housing market less if we built our own.
Which is the cheaper option, building our own for renting to those who need it verses buying off the market, paying a private landlord or hotel?
We're wasting tax payer money to service a growing crisis.0 -
Matt Barrett wrote: »I don't believe the public coffers were over flowing in the 1930's. If we can find money to exacerbate the housing crisis we can surely find it to quell it's growth, if the will was there.
Yet we'd need spend less on Social Protection and interfere with the housing market less if we built our own.
Which is the cheaper option, building our own for renting to those who need it verses buying off the market, paying a private landlord or hotel?
We're wasting tax payer money to service a growing crisis.
The simplest solution is to increase the LPT to pay for Social Housing. Only those who own houses already pay the LPT. Therefore, as in all good socialists traditions, we see a redistribution in wealth from those who have, to those who have not.
The failure of certain local authorities to maintain the levels of LPT is a disgrace. I hope that the review being undertaken by government allow for further upward revision of LPT to help the housing crisis.
Unlike many of the other hare-brained ideas put out there to solve the issue, this is an important step to finding the necessary funding.0 -
The simplest solution is to increase the LPT to pay for Social Housing. Only those who own houses already pay the LPT. Therefore, as in all good socialists traditions, we see a redistribution in wealth from those who have, to those who have not.
The failure of certain local authorities to maintain the levels of LPT is a disgrace. I hope that the review being undertaken by government allow for further upward revision of LPT to help the housing crisis.
Unlike many of the other hare-brained ideas put out there to solve the issue, this is an important step to finding the necessary funding.
Sounds like an option.
Sadly I think there isn't much will to build social housing in any meaningful number otherwise we'd be seeing builds already under way.0 -
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Matt Barrett wrote: »Sounds like an option.
Sadly I think there isn't much will to build social housing in any meaningful number otherwise we'd be seeing builds already under way.
Agreement with blanch?
Sounds like an option? A skewed tax based on home valuation and location causing the amount of tax to be contributed.?
Tell me now, what would be the difference of agreement with a household charge for water to alleviate the funding of that service as opposed to housing?
Sounds a bit hypocritical to me based on your feelings as regards that service?0 -
does anyone else here think this scenario is very plausible? the election comes, FG biggest party, FF go in with them, into coalition, but they split the ministries evenly?0
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Idbatterim wrote: »does anyone else here think this scenario is very plausible? the election comes, FG biggest party, FF go in with them, into coalition, but they split the ministries evenly?
Personally I'd doubt it. I can't see either agreeing to anything other than a confidence and supply arrangement, I'd be surprised if they left the door open to SF to Bethe main opposition party while both of them become the target.0 -
Agreement with blanch?
Sounds like an option? A skewed tax based on home valuation and location causing the amount of tax to be contributed.?
Tell me now, what would be the difference of agreement with a household charge for water to alleviate the funding of that service as opposed to housing?
Sounds a bit hypocritical to me based on your feelings as regards that service?
I would favour both, but in a reformed LPT, which allows for greater variance by local authorities, the valuation issue would be less of a problem.0 -
I would favour both, but in a reformed LPT, which allows for greater variance by local authorities, the valuation issue would be less of a problem.
I'm not arguing your point at all really, there's merit in it.
I live in a four bed in Cavan, value 130k or so, move that 50 miles east and its crazy the difference.
Just Matt agreeing to a higher household charge for his pet as opposed to another, when financing one would free up money to finance the other seems a bit off to me?0 -
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Agreement with blanch?
Sounds like an option? A skewed tax based on home valuation and location causing the amount of tax to be contributed.?
Tell me now, what would be the difference of agreement with a household charge for water to alleviate the funding of that service as opposed to housing?
Sounds a bit hypocritical to me based on your feelings as regards that service?
Is this a point scoring exercise?
What part of 'sounds like an option' confuses you? I believe Blanch was considering LPT as a funding source. That would be an option.
I don't like the TV licence but there it is and a source for funding RTE.
The water charge is a completely different ball game as we already pay. Your analogy would work if we were hit with an LPT charge aside from property tax we already pay. Not to mention the addition of a dubious quango set up.I'm not arguing your point at all really, there's merit in it.
I live in a four bed in Cavan, value 130k or so, move that 50 miles east and its crazy the difference.
Just Matt agreeing to a higher household charge for his pet as opposed to another, when financing one would free up money to finance the other seems a bit off to me?
Who did what now?
What do you mean 'for my pet'? Is the idea of social housing up for derision? What's your solution to the housing crisis and how would you fund it?0 -
Matt Barrett wrote: »Is this a point scoring exercise?
What part of 'sounds like an option' confuses you? I believe Blanch was considering LPT as a funding source. That would be an option.
I don't like the TV licence but there it is and a source for funding RTE.
The water charge is a completely different ball game as we already pay. Your analogy would work if we were hit with an LPT charge aside from property tax we already pay. Not to mention the addition of a dubious quango set up.
Who did what now?
What do you mean 'for my pet'? Is the idea of social housing up for derision? What's your solution to the housing crisis and how would you fund it?
I'd have water charges for a start, and use the money saved from that towards other services, housing being one of them.
There are other ways of doing it, increasing property tax is another way too, but I feel it needs to be inclusive of all society, not just the people already in the tax net.
Social welfare perhaps needs to be tweaked too, our welfare bill is huge.0 -
I'd have water charges for a start, and use the money saved from that towards other services, housing being one of them.
There are other ways of doing it, increasing property tax is another way too, but I feel it needs to be inclusive of all society, not just the people already in the tax net.
Social welfare perhaps needs to be tweaked too, our welfare bill is huge.
I don't believe we'd have anything left over form the water charge, quite likely it would not cover itself.
Social welfare rates are based on the cost of living. I don't think it's an easy tweak. What about all the millions we saved from Leo's welfare fraud campaign? The cost of living includes rent. We subsidise rents because people can't afford it, working people too. We can't cut that. Well we could and then watch the hotel bills go up as more join the 'emergency'.
I know it's a small amount on the grand scheme but I wonder were the money for the Pope's gig came from (32m), the holy money tree?0 -
Matt Barrett wrote: »I don't believe we'd have anything left over form the water charge, quite likely it would not cover itself.
Social welfare rates are based on the cost of living. I don't think it's an easy tweak. What about all the millions we saved from Leo's welfare fraud campaign? The cost of living includes rent. We subsidise rents because people can't afford it, working people too. We can't cut that. Well we could and then watch the hotel bills go up as more join the 'emergency'.
I know it's a small amount on the grand scheme but I wonder were the money for the Pope's gig came from, the holy money tree?
Maybe we should cancel all other life till we get the housing sorted?
We fund arts, sport and other innesential stuff really, give tax breaks to all sorts of stuff.
Basically maybe a few tweaks in all these things could go to housing.
But my point was that I can't see the sense in saying that an increase in lpt could have More of an affect than charging for water, basically the same people + perhaps affected and more money raised.0 -
Matt Barrett wrote: »I don't believe we'd have anything left over form the water charge, quite likely it would not cover itself.
Social welfare rates are based on the cost of living. I don't think it's an easy tweak. What about all the millions we saved from Leo's welfare fraud campaign? The cost of living includes rent. We subsidise rents because people can't afford it, working people too. We can't cut that. Well we could and then watch the hotel bills go up as more join the 'emergency'.
I know it's a small amount on the grand scheme but I wonder were the money for the Pope's gig came from (32m), the holy money tree?
Since when are social welfare rates based on the cost of living?
And it isn't just rates, the eligibility criteria need to be examined carefully.0 -
Since when are social welfare rates based on the cost of living?
And it isn't just rates, the eligibility criteria need to be examined carefully.
Since always. Any rise is based on the cost of living. We can go round and round but the cost of living is the presiding factor.
http://www.thejournal.ie/social-welfare-fiver-increase-3639019-Oct2017/
I would suggest there are many areas need another look at. The sick, elderly and poor shouldn't always be the suggested first stop IMO.0 -
Maybe we should cancel all other life till we get the housing sorted?
We fund arts, sport and other innesential stuff really, give tax breaks to all sorts of stuff.
Basically maybe a few tweaks in all these things could go to housing.
But my point was that I can't see the sense in saying that an increase in lpt could have More of an affect than charging for water, basically the same people + perhaps affected and more money raised.
Simply pointing out money can be found when the will is there. We cancelled christmas the Christmas bonus in the past. It seems sometimes that only funding to assist the tax payer requires fantasy money.
We could tax vulture funds adequately. We could heavily tax property companies. We could cancel AIB paying no tax on profits for the next 30 years. I'm sure there's lots of things, but let's look at the most disadvantaged in society first or new charges for people some of who are already strapped.0 -
Matt Barrett wrote: »Simply pointing out money can be found when the will is there. We cancelled christmas the Christmas bonus in the past. It seems sometimes that only funding to assist the tax payer requires fantasy money.
We could tax vulture funds adequately. We could heavily tax property companies. We could cancel AIB paying no tax on profits for the next 30 years. I'm sure there's lots of things, but let's look at the most disadvantaged in society first or new charges for people some of who are already strapped.
We could double Corporation Tax - another daft idea!0 -
Matt Barrett wrote: »Since always. Any rise is based on the cost of living. We can go round and round but the cost of living is the presiding factor.
http://www.thejournal.ie/social-welfare-fiver-increase-3639019-Oct2017/
I would suggest there are many areas need another look at. The sick, elderly and poor shouldn't always be the suggested first stop IMO.
I guess you're not aware that the cost of living in July 2018 is lower than it was in July 2008.
Social welfare has been increased from €15.5 bn in 2007 to €19.8 bn in 2016.0 -
Good loser wrote: »We could double Corporation Tax - another daft idea!
What's the daft idea? Why so dismissive? Do you suggest we go after the sick, elderly and poor? That'll solve everything? Very odd attitude. Seems pretty aggressive for a discussion on possible solutions to a crisis.Good loser wrote: »I guess you're not aware that the cost of living in July 2018 is lower than it was in July 2008.
Social welfare has been increased from €15.5 bn in 2007 to €19.8 bn in 2016.
Rent is cheaper now than in 2008? Everything is?
There seems to be a hate for all on welfare. If you feel some are on it who shouldn't be or some are getting too much that's on government. Talk to your representative. Haranguing those in need of income support, rent aid, children, the sick, elderly and poor because government are doing a bad job of policing, allocating tax monies is on them. However I'd start with AIB paying no tax on profits for the next 30 years before I started cribbing about waste on the poor and working tax payers on low income. Or are some tax payers more important than others?0 -
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Matt Barrett wrote: »What's the daft idea? Why so dismissive? Do you suggest we go after the sick, elderly and poor? That'll solve everything? Very odd attitude. Seems pretty aggressive for a discussion on possible solutions to a crisis.
Rent is cheaper now than in 2008? Everything is?
There seems to be a hate for all on welfare. If you feel some are on it who shouldn't be or some are getting too much that's on government. Talk to your representative. Haranguing those in need of income support, rent aid, children, the sick, elderly and poor because government are doing a bad job of policing, allocating tax monies is on them. However I'd start with AIB paying no tax on profits for the next 30 years before I started cribbing about waste on the poor and working tax payers on low income. Or are some tax payers more important than others?
That is ridiculous hyperbole.
It is not hating welfare to suggest that those who work should be rewarded better than those who are on social welfare. Society only has a finite amount of resources and the allocation of them should be fair and based to a certain extent on what you contribute.0 -
That is ridiculous hyperbole.
It is not hating welfare to suggest that those who work should be rewarded better than those who are on social welfare. Society only has a finite amount of resources and the allocation of them should be fair and based to a certain extent on what you contribute.
I was asking why the seemingly aggressive undertones on that posters comments regarding welfare. You cannot chime in on that.
On your point, it's not about rewarding. Welfare payouts are based on need. If you don't like the metric used to measure need, fair enough.
We aren't in competition with these people and it's not necessarily an either or. The idea that people worse off than the majority of society should be the first stop in accruing funding for housing for the same demographic seems odd to me. It smacks of begrudgery and blame. Those with the least should give more is a road to nowhere. Sure we can always trim any excess.
It seems AIB will be contributing nothing from their profits for the next 30 years, but let's glean a few euro off the most vulnerable in society and leave that lay.
Additional:
Here's fun, how about all the banks supported and bailed out by the tax payer give the government low/no interest loans to build social housing?
If the tax payer can give private developers loans for private builds surely private banks can loan private money for public builds? Or does it not work out both ways because the market or something?
If Johnny feeds two kids instead of three how many dinners will it take to finance one social housing build?0 -
Matt Barrett wrote: »What's the daft idea? Why so dismissive? Do you suggest we go after the sick, elderly and poor? That'll solve everything? Very odd attitude. Seems pretty aggressive for a discussion on possible solutions to a crisis.
Rent is cheaper now than in 2008? Everything is?
There seems to be a hate for all on welfare. If you feel some are on it who shouldn't be or some are getting too much that's on government. Talk to your representative. Haranguing those in need of income support, rent aid, children, the sick, elderly and poor because government are doing a bad job of policing, allocating tax monies is on them. However I'd start with AIB paying no tax on profits for the next 30 years before I started cribbing about waste on the poor and working tax payers on low income. Or are some tax payers more important than others?
Are you serious? You said social welfare rates were based on cost of living.
I gave stats that showed your claim was a lie.
And you come back with this rant! The kind of rubbish Boyd Barrett and Sinn Fein constantly get away with in radio interviews.0 -
Good loser wrote: »Are you serious? You said social welfare rates were based on cost of living.
I gave stats that showed your claim was a lie.
Social Welfare is inclusive of many different payments, not exclusively dole payments. State pensions (it's biggest single expenditure actually) for example come from this budget.
I didn't actually see the source of your stats, but I'm guessing they're certainly not factoring in minor details like the cost of rental accommodation (you know that crisis we had and is still ongoing that forced the govt to introduce new legislation on private landlords rental % rises etc) energy costs (is anyone here paying cheaper rates of gas or electricity or oil than they were in 2008?) Insurance hikes, and tobacco or alcohol?
So unless these welfare recipients don't need shelter nor energy - they should be grand so altogether.
You might want to ask Leo why he fired off more to those on SW than many of those working got by way of tax cuts got in the last budget seeing as how you reckon they should be able to survive on less now than they did in 2008.
Saying you gave stats without actually posting stats, and providing a source for them, doesn't really cut the mustard I'm afraid G.L
#keeptherecoverygoing.0 -
Matt Barrett wrote: »
Here's fun, how about all the banks supported and bailed out by the tax payer give the government low/no interest loans to build social housing?
Why would they do that, when the government can borrow cheaper than a bank?
Anyway, they can't.
People are not yet used to the new reality here. This is not 2008 where the government of the day could go out an borrow/spend billions on the latest populist offering to buy votes. Those days are gone.
There are new strict fiscal rules in place, that all EU member states must adhere to.
FG or whoever is in power cannot borrow billions without cutting somewhere else.
We cannot take on new debt, so forget about it. So ignore all the snake oiled sales men that promise you utopia by borrowing more money.0 -
Good loser wrote: »Are you serious? You said social welfare rates were based on cost of living.
I gave stats that showed your claim was a lie.
And you come back with this rant! The kind of rubbish Boyd Barrett and Sinn Fein constantly get away with in radio interviews.
They are. Find me a minister who said 'We'll raise welfare for the craic, sure they don't need it'? The reasoning for raising state aid is always related to and because of the cost of living. Do not accuse me of lying.
FYI: you didn't supply any link to any stats. You didn't answer my queries. Rent is cheaper?
I don't understand the aggressive tone.
I disagree in seeking funding for social housing by cutting welfare. It may need trimming but we've other fish such as AIB paying no tax on profits for the next 30 years we could be looking at before we go after the sick, elderly, poor and those working availing of state aid.0 -
They have estimated they will not be paying tax on profits for up to 30 years. This is due corporations being allowed to stockpile previous years' losses and write them off against future tax bills. It's available to any corporation, so is not unique to AIB.Matt Barrett wrote: »Good loser wrote: »Are you serious? You said social welfare rates were based on cost of living.
I gave stats that showed your claim was a lie.
And you come back with this rant! The kind of rubbish Boyd Barrett and Sinn Fein constantly get away with in radio interviews.
They are. Find me a minister who said 'We'll raise welfare for the craic, sure they don't need it'? The reasoning for raising state aid is always related to and because of the cost of living. Do not accuse me of lying.
FYI: you didn't supply any link to any stats. You didn't answer my queries. Rent is cheaper?
I don't understand the aggressive tone.
I disagree in seeking funding for social housing by cutting welfare. It may need trimming but we've other fish such as AIB paying no tax on profits for the next 30 years we could be looking at before we go after the sick, elderly, poor and those working availing of state aid.
Do you disagree with this policy in itself, or just in relation to AIB. You keep bringing up the 30 year timeframe a set number, when it is an estimate.0 -
They have estimated they will not be paying tax on profits for up to 30 years. This is due corporations being allowed to stockpile previous years' losses and write them off against future tax bills. It's available to any corporation, so is not unique to AIB.
Do you disagree with this policy in itself, or just in relation to AIB. You keep bringing up the 30 year timeframe a set number, when it is an estimate.
AIB is the one I read about.
I think having such policies in place while looking to cut state aid to the most vulnerable in society is a bit much IMO. We're talking no tax on profits for a bank previously aided by the tax payer. This coupled with the tax payer supplying cheap loans to developers shows we have a lot of things we could be looking at in seeking funds for social housing builds. Why not amend such laws? It seems some people are fine with playing with state aid to the most vulnerable but unwilling to look at such things as no tax on profits for banks. I think that's wrong headed.
What's your thoughts on raising funding for social housing?0 -
My thoughts are that social housing is an experiment that failed due to the conflict of interests caused by asking politicians to manage the lives of individuals who can vote them in or out of a job. One only has to look at how many residents are allowed to remain in social housing while not paying their rent to see how much of a priority the councils have made of ensuring it's a sustainable system. Arrears that could have been used to fund others even more vulnerable then themselves were passed over. They truly are an example of the piglets eating the sow.Matt Barrett wrote: »They have estimated they will not be paying tax on profits for up to 30 years. This is due corporations being allowed to stockpile previous years' losses and write them off against future tax bills. It's available to any corporation, so is not unique to AIB.
Do you disagree with this policy in itself, or just in relation to AIB. You keep bringing up the 30 year timeframe a set number, when it is an estimate.
AIB is the one I read about.
I think having such policies in place while looking to cut state aid to the most vulnerable in society is a bit much IMO. We're talking no tax on profits for a bank previously aided by the tax payer. This coupled with the tax payer supplying cheap loans to developers shows we have a lot of things we could be looking at in seeking funds for social housing builds. Why not amend such laws? It seems some people are fine with playing with state aid to the most vulnerable but unwilling to look at such things as no tax on profits for banks. I think that's wrong headed.
What's your thoughts on raising funding for social housing?
Again, would you single out banks as being exempt from writing off previous years' losses against profits, or remove it as a regulation entirely?
There is some irony in you talking about wanting to solve the housing issues, while lambasting a bank which went belly up because of it's reckless lending to property developer and builders who were themselves building housing for commercial sale.0 -
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My thoughts are that social housing is an experiment that failed due to the conflict of interests caused by asking politicians to manage the lives of individuals who can vote them in or out of a job. One only has to look at how many residents are allowed to remain in social housing while not paying their rent to see how much of a priority the councils have made of ensuring it's a sustainable system. Arrears that could have been used to fund others even more vulnerable then themselves were passed over. They truly are an example of the piglets eating the sow.
The system needs policing for sure. Can you think of an alternative, more emergency hotels or more tax payers money paying rent to private landlords? Even with the arrears it's a better deal for the tax payer no?
The social housing model took us out of the slums, mind the current model has us in hotels, progress?Again, would you single out banks as being exempt from writing off previous years' losses against profits, or remove it as a regulation entirely?
Again, I would look to amending such things before looking to the most vulnerable. I am not going down the rabbit hole of corporation tax and re-evaluating it nationally for your pleasure. My point is we can look in other places before we look to the tax payers in need of state aid to function, this would be one such area. What if profits far exceed any reported losses? That's an angle were tax might be recouped over the suggested 30 year period. They should not see any benefit from losses accrued and put on the tax payer anyway.There is some irony in you talking about wanting to solve the housing issues, while lambasting a bank which went belly up because of it's reckless lending to property developer and builders who were themselves building housing for commercial sale.
Hold your horses there chief. Nobody is lambasting AIB for availing of legal taxation policy.
I'll give you Irony, NAMA loaning tax payer money recouped from failed developers to fund developers for their own private profit. Likely, some of the the very people who created the need for NAMA. Here's another, a bank which went belly up as you say not having to pay tax on any profits for the next 30 years possibly, while some think looking at the poor to fund social housing is a legit proposition.
Again, any ideas yourself?0 -
Red_Wake wrote:They have estimated they will not be paying tax on profits for up to 30 years. This is due corporations being allowed to stockpile previous years' losses and write them off against future tax bills. It's available to any corporation, so is not unique to AIB.
It's also not unique to corporations individuals can also avail of loss relief.
Personally I don't see the issue. All AIB are doing is following the law. It also had and has the benefit of creating deferred tax assets on their balance sheet which ultimately reduced the size of the bailout required. Also its doubtful this situation will reoccur unless you have another state bailout of a company. The losses sustained by the banks would have sent any other company bust.0 -
It's also not unique to corporations individuals can also avail of loss relief.
Personally I don't see the issue. All AIB are doing is following the law. It also had and has the benefit of creating deferred tax assets on their balance sheet which ultimately reduced the size of the bailout required. Also its doubtful this situation will reoccur unless you have another state bailout of a company. The losses sustained by the banks would have sent any other company bust.
There's your issue right there. AIB are being lawful. There's no suggestion otherwise.
It's a bit rich to look to the most vulnerable in society to fund social housing to quell a crisis created in part by financial institutions and developers coupled with lackluster regulation, while on the other hand enabling developers and financial institutions who cost the tax payer money, profit off their prior loses with cheap loans off the tax payer and no tax paid on profits due to loses incurred. Just pointing that out is all.0 -
Matt Barrett wrote:There's your issue right there. AIB are being lawful. There's no suggestion otherwise. It's a bit rich to look to the most vulnerable in society to fund social housing to quell a crisis created in part by financial institutions and developers coupled with lackluster regulation, while on the other hand enabling developers and financial institutions who cost the tax payer money, profit off their prior loses with cheap loans off the tax payer and no tax paid on profits due to loses incurred. Just pointing that out is all.
What's your evidence that overall the decision has resulted in a net loss to the government? It's not as clear cut as you assume. You could be right but also wrong given how these tax losses impact a banks/any companies accounts.
The thing is these losses ultimately saved and are saving the government money. Then enabled larger deferred assets(therefore larger total assets) on a banks balance sheet and thus reduced the amount the government had to borrow to bail the banks out and also saved on interest payments related to this debt. Given that banks are public institutions and have to file accounts its perfectly possible to estimate the cost/benefit of allowing these losses against tax on future taxable profits(note accounting profit and taxable profit are not the same, which gives rise to deferred tax assets /liabilities) . So yes while the government is losing out on tax revenue as a result of the losses it also saved money via a reduced bailout amount and associated interest fees. Its a cost benefit question.
Personally I wouldn't be against looking at making changes to loss relief. But it's a complicated area. Aside from the relevant tax law, changes will also impact a companies accounts. It's something for people in Revenue and other people who understand the area to have a look at.0 -
What's your evidence that overall the decision has resulted in a net loss to the government? It's not as clear cut as you assume. You could be right but also wrong given how these tax losses impact a banks/any companies accounts.
The thing is these losses ultimately saved and are saving the government money. Then enabled larger deferred assets(therefore larger total assets) on a banks balance sheet and thus reduced the amount the government had to borrow to bail the banks out and also saved on interest payments related to this debt. Given that banks are public institutions and have to file accounts its perfectly possible to estimate the cost/benefit of allowing these losses against tax on future taxable profits(note accounting profit and taxable profit are not the same, which gives rise to deferred tax assets /liabilities) . So yes while the government is losing out on tax revenue as a result of the losses it also saved money via a reduced bailout amount and associated interest fees. Its a cost benefit question.
Personally I wouldn't be against looking at making changes to loss relief. But it's a complicated area. Aside from the relevant tax law, changes will also impact a companies accounts. It's something for people in Revenue and other people who understand the area to have a look at.
Agreed and thanks for the clarification.
It's referred to as 'tax on profits', I would take that to mean profit after meeting any debts owed. Are all of AIB's debts to the state repaid? Does no tax on profits mean no tax on profits after all debts are paid? Is the idea that AIB didn't cost the tax payer as much as they could have benefiting AIB? I don't know.
My point is when looking for funding to finance social housing builds, why look to the most vulnerable in society when there may be monies elsewhere? I gave the AIB no tax on profits as a possible area to look at before a tax payer who can't make rent reliant on state aid. The word 'profits' has me thinking no tax on monies after debts, costs and salaries are met. That's what caught my eye. I may be wrong, but either way looking to those worse off to glean a few euro off to fund a possible solution to a crisis in the most part caused by others, is a bit much IMO.0 -
The government are still the largest shareholder in AIB, so while they won’t receive tax on profits for a number of years, they would receive dividends if they are paid out from the profits. Whatever isn't paid in dividends will presumably end up on the balance sheet and increase the value of the governments shareholding allowing to sell them for increased value in the future. 13.5% corporation tax could well pale into insignificance when compared to dividends and capital gains. It’s not as if the government have to pay income tax or CGT on them.0
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Matt Barrett wrote: »Agreed and thanks for the clarification.
It's referred to as 'tax on profits', I would take that to mean profit after meeting any debts owed. Are all of AIB's debts to the state repaid? Does no tax on profits mean no tax on profits after all debts are paid? Is the idea that AIB didn't cost the tax payer as much as they could have benefiting AIB? I don't know.
My point is when looking for funding to finance social housing builds, why look to the most vulnerable in society when there may be monies elsewhere? I gave the AIB no tax on profits as a possible area to look at before a tax payer who can't make rent reliant on state aid. The word 'profits' has me thinking no tax on monies after debts, costs and salaries are met. That's what caught my eye. I may be wrong, but either way looking to those worse off to glean a few euro off to fund a possible solution to a crisis in the most part caused by others, is a bit much IMO.
Not unexpectedly you seem to be completely unaware that the Govt owns approximately 75% of AIB.
So if any profits are distributed the Govt gets 75% of those plus the income tax on the income to the other shareholders.
Plus the more profits made, and dividends declared, the capital value of AIB increases and can be captured by the Govt in another share sale.
Amazing that you should devote so much hot air to AIB contributing to housing when you can see no link between water charges and housing - social and other.0 -
Matt Barrett wrote:Agreed and thanks for the clarification. It's referred to as 'tax on profits', I would take that to mean profit after meeting any debts owed. Are all of AIB's debts to the state repaid? Does no tax on profits mean no tax on profits after all debts are paid? Is the idea that AIB didn't cost the tax payer as much as they could have benefiting AIB? I don't know. My point is when looking for funding to finance social housing builds, why look to the most vulnerable in society when there may be monies elsewhere? I gave the AIB no tax on profits as a possible area to look at before a tax payer who can't make rent reliant on state aid. The word 'profits' has me thinking no tax on monies after debts, costs and salaries are met. That's what caught my eye. I may be wrong, but either way looking to those worse off to glean a few euro off to fund a possible solution to a crisis in the most part caused by others, is a bit much IMO.
If you want to understand exactly what is meant by the word profits at least in a accounting sense you are going to have to look up IFRS(International financial reporting standards). In general profit is revenue minus costs which includes the cost of debt finance. But for specifics you will have look up and understand IFRS which I assume AIB are using. As I have said a companies taxable profit will be different to the accounting profit due to Revenue using different rules when compared to whatever set of accounting standards are being used.
As others have pointed out the government owns the majority of AIB so most of the profit after tax is due to the government anyway.0 -
Matt Barrett wrote: »Agreed and thanks for the clarification.
It's referred to as 'tax on profits', I would take that to mean profit after meeting any debts owed. Are all of AIB's debts to the state repaid? Does no tax on profits mean no tax on profits after all debts are paid? Is the idea that AIB didn't cost the tax payer as much as they could have benefiting AIB? I don't know.
My point is when looking for funding to finance social housing builds, why look to the most vulnerable in society when there may be monies elsewhere? I gave the AIB no tax on profits as a possible area to look at before a tax payer who can't make rent reliant on state aid. The word 'profits' has me thinking no tax on monies after debts, costs and salaries are met. That's what caught my eye. I may be wrong, but either way looking to those worse off to glean a few euro off to fund a possible solution to a crisis in the most part caused by others, is a bit much IMO.
Note that debt capital repayments are not an allowable deduction when calculating profits.
Interest on debts is an allowable business expense.
The bigger issue is that all companies are allowed carry forward past losses against future profits.
So AIB is being treated like any firm. It is allowed to use past losses to reduce current profits.0 -
Geuze wrote:Note that debt capital repayments are not an allowable deduction when calculating profits.
In terms of the banks correct me if I'm wrong but wasn't all/nearby all the money leant to the banks invested in equity and not debt. So if the government does want more from the banks all it has to do ask the banks for dividend payments. From memory the government also bought a lot of preference shares and would probably get more than 75% of the dividends on AIBs case. A far better return than what they would get via 12.5% corporation tax.0 -
Matt Barrett wrote: »
Again, I would look to amending such things before looking to the most vulnerable. I am not going down the rabbit hole of corporation tax and re-evaluating it nationally for your pleasure. My point is we can look in other places before we look to the tax payers in need of state aid to function, this would be one such area. What if profits far exceed any reported losses? That's an angle were tax might be recouped over the suggested 30 year period. They should not see any benefit from losses accrued and put on the tax payer anyway.
Hold your horses there chief. Nobody is lambasting AIB for availing of legal taxation policy.
I'll give you Irony, NAMA loaning tax payer money recouped from failed developers to fund developers for their own private profit. Likely, some of the the very people who created the need for NAMA. Here's another, a bank which went belly up as you say not having to pay tax on any profits for the next 30 years possibly, while some think looking at the poor to fund social housing is a legit proposition.
If profits exceed reported losses, they will pay tax.0 -
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