# We must avoid taxing the economy to death



## onq (23 Aug 2009)

Taking more money out of the economy to pay for overgrown local government, central government, civil and health services is not the way to help Ireland's economy recover.

This is particularly so at a time when even those businesses which are still afloat are finding it impossible to get finance from those whose rash actions caused the current crisis.
This lack of liquidity in lending is caused by the banks and this has been shown to be the case over the past year in independent reviews.
Preventing access to loan facilities by those for whom we have mortgaged our children's futures is a national disgrace.

Stealth water charges. for example, are likely to most affect poorer, larger families who wash and cook for their children far more than sinkies or dinkies [still on six figure incomes.

Peter paying Paul paying Mary is what is required to get the economy moving again - the whole point of an economy is that people pay for goods and services  - _and keep doing so_ - not hoard their money.

Closing tax-exile escape hatches world wide is required, not least to reassert the moral authority under which all democratically elected governments must operate their tax regimes.

Strategic investments in infrastructure is a justifiable long term investment and is precisely what it required to help our ailing economy along in the short to medium term, not more taxes on a shrinking population of those eligible to be taxed.

Taxing the economy to death won't solve this crisis.
Cutting huge numbers of jobs won't solve this crisis.
Productivity and value in jobs, innovation in business and liquidity in lending is what's required.

If the Banks won't provide the necessary capital perhaps there is someone on this forum who understands what's required and will step up and fill the breach.

Please could each responder - in addition to commenting on the strategy - add one new non-tax increasing, pro-investment, pro-active suggestion to this thread.

FWIW

ONQ.


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## darag (24 Aug 2009)

How about not taking money of the economy and the future economy to pay off the creditors of failed enterprises like insolvent banks?  You could save 4 to 10 billion in the case of Anglo alone.  The higher end of the scale matches current projections of a years worth of income tax.


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## Protocol (24 Aug 2009)

Please note that as tax revenues have and are falling fast, then our tax levels will be way below the EU norm.


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## Gervan (24 Aug 2009)

> non-tax increasing, pro-investment, pro-active suggestion


I'll be shot down, but : do away with the minimum wage. If people are cheaper to employ, the unemployment lists would fall, less Social welfare be paid out etc. 
Am self employed, so working for far less than minimum wage this year.


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## Protocol (25 Aug 2009)

I don't know if I would abolish the min wage, but what about the following:

1) reduce the adult rate from 8.65 to 8.00

2) introduce a lower rate for 18, 19, 20, 21 years olds = 7.00


This would help the retail, catering, tourism sectors.


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## z109 (25 Aug 2009)

I agree with you to a degree, onq, but I am most concerned about indirect taxes - health care fees, education fees in our 'free' education system, local authority rates etc. These fall disproportionately on those on low incomes, as in, those not earning much, but enough to be above the means test. As many of the fees and charges do not apply to those on welfare, they constitute a barrier to re-entry to the workforce, a welfare trap.


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## BeanPole (31 Aug 2009)

Eliminate the minimum wage, and cut UA/UB payments by 50%, with a max payout of €70 per week to anyone under the age of 25


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## liaconn (31 Aug 2009)

BeanPole said:


> Eliminate the minimum wage, and cut UA/UB payments by 50%, with a max payout of €70 per week to anyone under the age of 25


 
There is definitely a strong argument for reducing the minimum wage but eliminating it would lead to exploitation of vulnerable workers, including the many migrant workers who are here on permits.


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## Stonesie (31 Aug 2009)

Beanpole, your still sticking to cutting unemployment benefits by 50%, how can somebody not see that the cutting jobseekers benefit (which only applies to long term workers) would freeze the economy. Anybody at risk of losing their job would think very hard of parting with cash, therefore reducing aggregate demand and increasing unemployment. 

Subtle changes are required, if you want examples of what radical policy changes do, look at Greece, stability is always a benefit

In response to feasible suggestions to cut expenditure. I'm in favour of bringing in fees for public services for those who can afford them. (e.g. fees for 3rd level education, if parents make over 80K between them)

Public services need reform, I'd start with Iarnrod Eireann, way too many staff for the quality of service provided,


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