CS Monitor, April 1, 2012
As the deadline passed midnight Sunday for payment of a new government fee, only 49 percent of households had signed up to pay amid frustration with the government’s austerity agenda.
By Jason Walsh, Correspondent / April 1, 2012
DUBLIN, IRELAND—A majority of Irish households have refused to pay a new government fee in a tax revolt led, unusually, by socialists.
The Irish government levied the new tax in an attempt to shore up the country’s finances that were devastated by economic collapse and a series of bank bailouts. But as the deadline passed midnight Sunday, only 49 percent of households had signed up to pay.
With no rioting and few protests, Ireland had been until now the quietest of the ravaged economies on the fringes of the European Union. However, the tax revolt reveals significant frustration here to budgetary reforms and foreshadows trouble ahead for the government’s efforts to meet EU bailout demands.
Ruth Coppinger, spokesperson for the Campaign Against Household and Water Taxes and Socialist Party councilwoman for Dublin, says the refusal to pay the property tax — and forthcoming water metering — is a rejection of austerity policies ushered in by the government at the behest of the EU, European Central Bank, and International Monetary Fund.
“The mood in society has changed. The general feeling is that we didn’t create this mess and we’re being asked to pay for it,” she says.
Flat fee first, then property tax
All Irish households are being charged a flat fee of €100 ($133) with the promise that the “household charge” will be replaced by a tax based on property value in 2013.
Minister for the environment Phil Hogan thanked those who had registered to pay the tax, saying: “I know that Irish people have had a difficult time time of it over the last few years and, in spite of that 800,000 have registered and paid the charge. They understand the need to pay for local services and, by paying the household charge, they have made their valuable contribution to the continuation of essential services at the local level.”
Estimates on how many dwellings are liable to pay vary, with the government saying 1.6 million and opponents of the levy saying the census reveals 1.8 million. But with at least half of the households in the country refusing to pay the government is coming under intense pressure.
The opposition is being led by left-wing parties in parliament, including the Socialist Party, the People Before Profit Alliance, and Sinn Féin.
Ireland has no ongoing property tax
Unlike other European countries, Ireland has had no ongoing property tax since “residential rates” were abolished in 1977. A stamp duty tax is paid on buying a property, while a flat annual charge of €200 ($266) is levied on second homes.
Ms. Coppinger says opposition to the tax is an issue for socialists because it is being levied unfairly.
“It’s not a tax on wealth, it’s a tax on the family home. We’d call for an assets tax [but] there’s no trawl being done on Monet paintings. It’s a tax on low and middle income people. A family home is a place to live, not an investment,” she says.
The levy is supported by the governing center-right Fine Gael and center-left Labor parties, as well as the former government party, centrist Fianna Fáil.
Ireland’s small but vocal left accounts for just 26 out of 166 seats in parliament but has tapped into a wider sentiment in society, angered by previous tax increases, high unemployment, mass emigration, and public service cuts.
‘Tea Party socialists’
Some have mocked the protesters as “Tea Party socialists.”
Jim Jackman, a protester who attended a rally Saturday in Dublin, said the appellation is unfair.
“A broad range of people from all social sides of Irish life are very angry. Enough is enough. The government parties are not listening to the people on the ground,” he says.
The timing couldn’t be worse for the government. Ireland is facing a May referendum on the EU fiscal treaty and the property tax has been mandated by Europe and the IMF as part of the country’s bailout terms. The most recent opinion poll says 49 percent will vote Yes to the EU fiscal treaty and 33 percent will vote No, but with 18 percent still undecided and growing anti-austerity sentiment the government could be dealt a humiliating defeat that would lock Ireland outside of the European Stability Mechanism, the EU’s permanent bailout fund.
‘No, no we won’t pay’
Worse still, the deadline for payment was on the first day of a party conference by the ruling Fine Gael. Defiant protesters turned up outside the Dublin Convention Center venue, chanting “No, no we won’t pay.” Police estimated a turnout of 5,000, while protesters said 10,000.
Widespread non-payment is a direct affront to government authority, says Gerard Casey, philosophy professor at University College Dublin.
“The government desperately wants to save face with the EU, but this is the first sign that the public are not happy with what’s going on,” he says. “Irish people aren’t revolutionary by nature, they don’t go out on the streets like the French. By Irish standards this is like hundreds of thousands of farmers turning up in Paris.”
* Additional reporting by Gerard Cunningham.