Double standards on workers' tax

Revelations that the Fianna Fáil/Progressive Democrats' coalition government are backtracking on budget commitments to abolish tax exemption status for international executives highlighted yet again the double standards at work in government policy especially when it comes to the differing treatment of low and high-paid workers.

In the same weeks before Christmas that Irish Ferries employees were being asked to work longer hours for slave wages and working conditions that are illegal in Ireland, the Dublin Government who could do nothing for the shipping workers were caving into lobbying from the American Chamber of Commerce (ACC), the Irish Business and Employers Confederation (IBEC) and the Institute of Chartered Accountants of Ireland (ICAI) to allow special tax perks for international business executives working In Ireland.

Before the budget international executives who worked in Ireland only paid tax on the proportion of their wages they actually spent in Ireland. For the high-paid elite this meant that most of their income was untaxed here.

Brian Cowen's budget proposals had promised to close this tax loophole, but in the weeks since the budget Cowen has backed down and now employment and Enterprise Minister Micheal Martin has announced new proposals that would create an "Executive Green Card", applicable to workers who earn more than €60,000 annually. The executive green card will be for workers who possess skills that are in short supply in Ireland. Surely such a definition would include most immigrant workers coming to Ireland with valuable work skills and qualifications. But it seems the only criteria for these skills in short supply are that they are high-paid ones.

The cost to the exchequer last year of not taxing these high-income workers was €100 million. Now it seems that it in the same week that Bertie Ahern was writing to the Trade Union Movement asking them to attend new social partnership talks that would discuss the protection of vulnerable workers and related issues as a first strand of the negotiations, his own Department of Finance and Enterprise were secretly rewriting budget policy to reopen a tax loophole. The new proposals will be in February's Finance Bill, and the department won't comment until then.

It is worth noting that the American Chamber of Commerce in their response to the budget said last December that, "the remittance basis of income taxation is a key feature in the package of tax measures that have attracted overseas multinationals and their senior executives to Ireland".

This week the reality of migrant workers in Ireland is that if you are high paid you won't get taxed and will have the government bending over backwards to facilitate you. If you are low paid it's a work environment of low wages, long hours and scantily enforced labour legislation. The treatment of GAMA workers who had to go on strike to get their actual pay shows just one example the gap between the low and high paid in the Irish economy.