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  • Household charge - will you pay it? Is it worth it?
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Dec 16, 2011 - 09:00

Household charge - will you pay it? Is it worth it?

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Household charge - will you pay it? Is it worth it?

You can read my thoughts on it or go straight down to the bottom and vote immediately....


My 2 cents worth....
In this country we have a conundrum of taxes being collected centrally then distributed to localities. This naturally creates a subservient local government who have to play pauper to the powers that be centrally. It also means we are not readily privvy to the accountability chain. There is no sense of 'value' locally because much of the services we receive are paid for indirectly.
The cost of delivering water to a house is not unlike the cost of delivering electricity to a house, and yet we don't have protests seeking 'free energy paid for from taxation'. We do, and will have issues with the water service charges along those lines.
Just as we are already seeing problems with the proposed €100 household charge. This is the first step towards a site value taxation. It is the most regressive (places a greater burden on the poor than the rich) roll out imaginable because it is going to be a 'flat charge'. Meaning a bolt hole on a hillside pays the same rate as a mansion on Ailesbury Road. There is no more foolish way I can think of doing this....
The caveat however, is that the foundation of the idea is sound, and the future of it is vital if we are going to shift our tax base towards one where you have taxes for things you consume at a cost (water, local roads & services, schools, sewage removal/processing etc.) and another tax for central spending.
Imagine this: if we had a strong local taxation regime the hospital in Roscommon wouldn't have been shut down. Instead, the people of Roscommon would be supporting that hospital budget and they could decide for themselves how to spend their money, or indeed to raise local taxes to keep the hospital if needs be. 

This is before we even look at some of the madness of how local authorities raise money now. At this moment in time any readers who rent or own a commercial business premesis are familiar with the 'rates bill' you get every year. What do you get in return for it? (very little). And why is it that a residential house on the same street doesn't have to pay for the very services businesses have to pay for? It is effectively a tax on business, a tax on enterprise and it sends out the wronge message; namely that 'business has to pay for everything' rather than 'the people who consume a particular service have to pay for it'.
I'd never walk into a shop, fill up my trolley and attempt to leave without paying, so why do some people think it's perfectly okay to want free water, sewage services, hospitals, schools and the like? The old chestnut 'my taxes pay for it' is a sham argument, there is no apportionment in taxes to tell us what ANY of it pays for! Given that we have a structural deficit what our taxes actually go on is government spending, but we don't have a precise breakdown of the income taxes that go to Garda in a certain area, that means there is no defined connection between the two.
Why would you see a Garda station closed if the people there wanted it? And why would taxes be collected nationally to pay for firemen in Dublin?
Surely the people that the station serves should be paying for that service as they are the beneficiary?
The Socialist Party wants everybody to revolt and not pay it. Their economic foundation for this is flawed as refusal to pay would warrant a €2,500 charge – 25 times the initial cost.
It would make far more sense for them to advocate non-payment of other taxes for which there is a late fee and surcharge well below this 25 times cost band. Of course, that would mean doing some actual homework and it isn't as instantly soundbite-worthy.
The argument that anybody can afford €2 a week is untrue; I have yet to find somebody who isn't due an exemption that will let me audit them to back this statement up, if any of our readers would like to volunteer the offer still stands. I'd go as far as saying that there shouldn't even be any exemptions.
The Universal Household Charge sucks, and it isn't fair, but it is a better choice (if it leads to a site value tax regime) than keeping our head in the sand and thinking we have a functional taxation regime when what we really have is a broken central transfer one.
I don't know about you, but I'll pay this tax and pay it happily in the knowledge that for the first time in a long time it is one that makes a little bit of sense.
So go ahead and agree or disagree in the comments section below (and don't forget to vote!)
[poll id="6"]
[poll id="7"]
 
Karl Deeter
(Twitter @karldeeter)

 Karl Deeter is Operations Manager with 

Irish Mortgage Brokers in Dublin
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