13 June 2002 Edition
Funding shortfall
We have a new government, have they any money? Exchequer returns for the first five months of 2002 show a serious problem. Income tax receipts are 15% down on last year. Total tax revenue is only 1% less than this time last year. Finance minister Charlie McCreevy had forecast an 8.6% increase in tax revenue.
The misery does not end there. Day to day government spending is 27% up on last year and double what McCreevy forecast.
The tax revenue figure was buoyed by significant increases in VAT and excise duty. Part of this increase is due to the 1% increase in the rate of VAT. Even so it is clear that households are spending money, but why is income tax revenue not rising.
Two simple answers occur. The first is that many of the new jobs created are low paid and these workers' meager earnings are out of the tax net. The second and more sinister answer is that high income earners could be finding more ways of avoiding tax.
It shows again that there is need for a comprehensive review and reform of the tax code. Meanwhile we will wait for the revisiting of McCreevy's dirty dozen spending cuts.
Nice II campaign starts
While most of us were watching the Ireland-Saudi match, Bertie Ahern was kick starting the second Nice Treaty referendum campaign. Last week Ahern appointed Dick Roche as a minister of State for Europe. Roche is the coalition's campaign manager and his appointment at such a sensitive time could be seen as an abuse of the referendum process as Fianna Fáil are not supposed to use government funds to promote a yes vote in the campaign.
Yesterday, Ahern traveled to Helsinki and Stockholm to discuss the new declarations on 26-County neutrality. Declarations that the Irish public have not yet had sight of. It is amazing that Ahern has chosen to ignore all the other concerns that Irish voters had about the treaty including loss of a commissioner, the lack of democracy within the EU, the loss of veto, etc.
This and the dovetailing of Roche's role as minister with the referendum campaign shows that Fianna Fáil have learnt nothing from last year's referendum defeat.
Sinn Féin TD Sean Crowe has called on the Taoiseach to explain why the government will not support bringing forward legal protection for Irish neutrality. "A key concern for the electorate, over the last number of years, is the ongoing militarisation of the EU and the impact of this on our neutrality," he said. "This is not just in relation to the Nice Treaty but successive treaties, including Maastricht and Amsterdam.
"A declaration on Irish neutrality is a political move it will have no legal effect and more importantly has no effect on the Nice Treaty. Sinn Féin is proposing that Irish neutrality be enshrined in the constitution - only then can it be guaranteed."
The misery does not end there. Day to day government spending is 27% up on last year and double what McCreevy forecast.
The tax revenue figure was buoyed by significant increases in VAT and excise duty. Part of this increase is due to the 1% increase in the rate of VAT. Even so it is clear that households are spending money, but why is income tax revenue not rising.
Two simple answers occur. The first is that many of the new jobs created are low paid and these workers' meager earnings are out of the tax net. The second and more sinister answer is that high income earners could be finding more ways of avoiding tax.
It shows again that there is need for a comprehensive review and reform of the tax code. Meanwhile we will wait for the revisiting of McCreevy's dirty dozen spending cuts.
Nice II campaign starts
While most of us were watching the Ireland-Saudi match, Bertie Ahern was kick starting the second Nice Treaty referendum campaign. Last week Ahern appointed Dick Roche as a minister of State for Europe. Roche is the coalition's campaign manager and his appointment at such a sensitive time could be seen as an abuse of the referendum process as Fianna Fáil are not supposed to use government funds to promote a yes vote in the campaign.
Yesterday, Ahern traveled to Helsinki and Stockholm to discuss the new declarations on 26-County neutrality. Declarations that the Irish public have not yet had sight of. It is amazing that Ahern has chosen to ignore all the other concerns that Irish voters had about the treaty including loss of a commissioner, the lack of democracy within the EU, the loss of veto, etc.
This and the dovetailing of Roche's role as minister with the referendum campaign shows that Fianna Fáil have learnt nothing from last year's referendum defeat.
Sinn Féin TD Sean Crowe has called on the Taoiseach to explain why the government will not support bringing forward legal protection for Irish neutrality. "A key concern for the electorate, over the last number of years, is the ongoing militarisation of the EU and the impact of this on our neutrality," he said. "This is not just in relation to the Nice Treaty but successive treaties, including Maastricht and Amsterdam.
"A declaration on Irish neutrality is a political move it will have no legal effect and more importantly has no effect on the Nice Treaty. Sinn Féin is proposing that Irish neutrality be enshrined in the constitution - only then can it be guaranteed."