The Hidden Face of the Fine Gael Tax Plan

‘The Coalition won office with the carrot of tax reform. Now het Garrett's crew has been in ower three months, people are beginning to realise that. behind the carrot has been the dreaded beg atick.

Mime Gael presented the tax reform ope a6 a PTOpresive move to the lower paid. In an RTE tntes ew Pitegerald summed it up as Ebows: “We are transferring from Gee tax pyetem to another, one Mech takes relatively more from the Setter off peaple with high incemes Mee grees more money and leaves Geet purchasing power to the lose eel-alf,"

SAME STRATEGY — TWO VERSIONS Ditakes a lot of hard neck to claim Saal indirect taxation om easctial Satsuimer pockls 1s more ‘progressive’ Than tax on Inccmme, Lt is universally Gcepied by economists that the Spposite is true. Indirect taxation fakes a higher ahare of workers® ipending power becauss itis coucen Gated on essential consmer gods @hich workers spend a higher share @ their inerme on, At the same time that Fitzgetahl was. lying through fis teeth on RTE, Joli Bruton was letting the cat out of the bag in an Trish Tires" interview, Asked if “indirect taxation would oot bit the iwer income groups”. Bouton frankly admitted “I would accept ihe argament that there is this disSdvantage to ladiréct tuxation; that it tends to be regressive.”

HOW IT WILL WORK The reality cam be aren in FG's Se pe to 25% will cost at beust £500hn. That suri is about half ef what is currently collected thitugh indirect taxes. This means that the price of food, clothes, school books, entertain ment ete will tise dramatically if incarnie tax is replaced by indiract tax. On the other hand the lower paid who cho met pay any ince! LAK oe who are only on the 25% rate wall rence oe concessions to help them Cece Che new price Tiges, Various economists have estimated that Fine Guel’s tux package will atid 8% to the cost of living, That is the sare a¢an Bb tax on every penny a worker apends without any Lax: free allowances ta cushion it, What a worker will lose chrough this.is tlearly considerably more than he or the will pin by a (O%8 ineore trx reduction, which by the way, only applies to that part of the wage packet net spent on dependents, mortbages, els, Bileen Desmond of Labour — particlpatingia the Fine Gael con trick plats which bag not received as.much public attention as the problem of indirect taxation, This concerna the élfect of the tis system: on wocephoyment, Unemployment has traditionally been viewed by employers and envernTCnLs asi weapon for forcing down wapea. Throughout Europe the aae of uneotpleyment in the fight to tke workers pay for cupitaliana’s crisis has made a chramatic comeback. Brnplovars atid politicians in Ireland ire onto the same trick, In the Wrish context, unemployment ia blunt weapon, The area where il eas the most effect is in skilled and sent-shilled employment, But the social welfare system, with paytelated henetits, cushions waders preciiely in these areas. Unemployed workers cun afford ta hedldood wot they can gel suitable joo with a readable wage, Wages and condi a Week. sam of EES. reduce their wiges, PO's strategy is designed to change this, (he origioa! Stueprint for this stritegy was drawn up in 1978 Pitrverald’s chist economic advisor, The basic plan was that the exisling Tak system would be abolished and replaced by a uniform 35% tax on all aaied income without any allewances, dechuciions of other comecssiorrs, Anyone aver 18 years aod eligible for work (eriployed on noth would pera El3 a week piyment. Parcota would recelye £3.75 weekly for each child under 18 while those oulside the labour force (housewives and self fmniphyed) would recelve £E00MIp The idea behind this plan is te put all unernployed workers, skilled cn unskilled, on un uniivable income, An unemployed worker who preacnthe peta £50 a week thiough a combinoghen of unemployed benefit, redundancy pay and tax rebates, would gela grand In the case of amarced couphe, they would get a total of £23.70. Even with | The JOE McDONNELL five children the full family income woul] MEMORIAL LIBRARY in West would still ooby be £42.25. In short, all | Belfast has appealed for donations Lhe pratuicqga “hand outs’ aro merely a | of new and second hand Irish way of chopping down security benefits, books (in English and Irish), Tt is pow esey ro gee where P's £960 aweek tor carried woven fits ite this scheme. “Ets mot ao much the money.” gays Sean O" Leary, Pia’s ditector of clectiona, “it is recognition of the place of this large group of Ween who wp to now have fell themselyes lanored.” In reality it is no such thing. Tt is park ala vicicns flan to ones the unemployed ancl umn then into cheap lebour which Jan compete wilh the emploverl aml One can only expect a grant from a ig. But what about the three SuCiist’ musketeers? Surely, if they have anny concern for workers' interess they should be fighting tooth ancl mail against Pitzperald’s tax plans Instead we bear thar they are going to support the Coalition powernment because of, as Joc Sherlock (SFR puts it, bitegerald’y “genuine concern for lax reform”. Their behaviour, Ln fact, ig more reminiscent of the three blirid mice.

They are supposed to be keep Fitzgerald on the straight a hairow path of social reform by threatening him with a general election, The simple teuth is, however, that Fitzgerald is venene them in a conservative struightjacket by threatening THEM with a general electionBRESDAN KELLY The library is a cooperative initiative aimed at making a broad selection of Trish books available to young readers in Weel Belfast. Readers of Socialist Republic who can contribute books may send them c/o The Connolly Bookshop, Avoca Park, Andersonstown, Belfast and we will he pleased Lo pass them along.

ond for thes murders on to their actual victimes.

+ and equate them with the execution of member of the British security beaten for what they are: pari and parcel of a deliberate anti-Catholic “pogrom bn this anes.” The people of the Ardoyne have torned their anger toward Unionisl politic— ans, Protestant ministers and he mesdlia who have described the killings as."Til for Tat” —a tick attempt to pas the A murvivar of 2 previous attack told us: “| beliewe this i: un attempt to make these morders in xeme way legitimate forces. Wf these Lorulist assgasing were Killing [RA volunteers ane could understand the “tit for tat” claim, but this . is dearly not the case and they ehould A woman from the Ardoyne area wii SOCIALIST REPUBLIC PAGE 3