The income and medical levies that were increased in this months emergency budget may be backdated to January 1st 2009. That would see most people paying hundreds of euro in extra tax this year, possibly out of their May pay cheque or spread out over the rest of the year. George Hook on Newstalk is covering the subject and was interviewing Ruairi Quinn from the Labour Party who said the tax increases could be backdated once the legal position was clarified.
It seems clear the Irish government has no idea how to stimulate the economy and will now just suck as much money as possible out of peoples pockets while hoping a global economic recovery will solve all their problems for them.
Update: It looks pretty official now. Many news papers have the story and apparently it was in one paper on Sunday. The Irish Times has a good article that explains what is likely to happen. Ordinary PAYE payments will not be hit instead it's likely the government will use the backdating to claw money out of people who received lump sum payments since January. In some cases these payments were attempts to evade tax later in the year once it became clear the government was going to increase the levies. However in many cases, including people who took voluntary redundancy payments, ordinary people who were not evading tax will now be hit as well. Many will have used those lump sums to reduce their mortgages or invested in long term bank accounts with penalty clauses for early withdrawal. Many others may now be unemployed and living off those lump sums. Now I personally wont be impacted having not taken redundancy or received a bonus but I still think this sets a dangerous precedence. If later in the year the government is forced to introduce another budget what would stop them backdating those taxes?
It seems clear the Irish government has no idea how to stimulate the economy and will now just suck as much money as possible out of peoples pockets while hoping a global economic recovery will solve all their problems for them.
Update: It looks pretty official now. Many news papers have the story and apparently it was in one paper on Sunday. The Irish Times has a good article that explains what is likely to happen. Ordinary PAYE payments will not be hit instead it's likely the government will use the backdating to claw money out of people who received lump sum payments since January. In some cases these payments were attempts to evade tax later in the year once it became clear the government was going to increase the levies. However in many cases, including people who took voluntary redundancy payments, ordinary people who were not evading tax will now be hit as well. Many will have used those lump sums to reduce their mortgages or invested in long term bank accounts with penalty clauses for early withdrawal. Many others may now be unemployed and living off those lump sums. Now I personally wont be impacted having not taken redundancy or received a bonus but I still think this sets a dangerous precedence. If later in the year the government is forced to introduce another budget what would stop them backdating those taxes?
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