An Irishman's Diary

Few things are quite so enjoyable as the regular declarations from the Conference of Religious of Ireland on taxation, and the…

Few things are quite so enjoyable as the regular declarations from the Conference of Religious of Ireland on taxation, and the need for more of it. They are of course not alone in this regard. Most commentators of the liberal-left have an illusory economic model upon which they too base their notions that high tax and large welfare payments are perfectly splendid things; but at least such people are normally of modest income and capital, and when they propose higher taxes, they can expect to be paying such taxes themselves.

At this point it should hardly be necessary to repeat the most obvious of truths: that high taxes do not hit the very rich - they cause them to flee, as Michael Smurfit did, to Monte Carlo of all places. (I think I'd rather pay taxes.) Or they employ creative accountants who can sail a three-rigger through the shoals of financial law blindfold and who have evaded tax reforms before the first comma in a Budget statement has been reached. Taxation doesn't hit such people; but it does hit middle management in private industry who have to invest in pensions against the day they retire.

Money laundering

Taxation in the past reached such ludicrous, but morally irreproachable levels that money laundering became a major industry. God bless my soul, as CORI might say. And the entire bien-pensant consensus was that taxation was a good thing because it enabled the State to give money to the poor.

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We know the consequences of that idiocy: vast numbers of people preferred to stay on the dole than enter a lawful economy of PAYE and PRSI (a taxation regime which the public servants who were the other beneficiaries of a high-taxation culture were, happily for them, spared, and indeed still are). Poverty actually increased as taxation inhibited enterprise and prompted evasion.

Not everybody was subject to the taxes that the plain people of Ireland were. Immigrant industries were given tax holidays, and their senior executives were given special - and probably illegal - taxation exemption. Native enterprise was being stifled because of low capital savings, so the Government finally introduced tax-deductible investment schemes whereby natives could enjoy the taxation advantages of incomers.

And this is the truth: our extraordinary economic growth has been based on low taxes, not on high. High taxes cause poverty, dependency, inertia, criminality, capital-emigration. High taxes curb growth and stimulate unemployment. High taxes imprison people in the God-forsaken ghettos we have created in urban outskirts. High taxes are the bane of civilisation.

Land sales

Throughout this period, one class conspicuously was exempt from taxation: the religious orders of Ireland, who are now more awash with money than they were even in the good old days when they had recruits. In the past 10 years, the majority of land sold in the Dublin area has been put on the market by religious orders. The transformation of the geography of the city has been brought about by the religious orders' realisation of assets accumulated several generations ago from the donations of the plain people of Ireland. But the plain people of Ireland have not been the beneficiaries when the land-bank was cashed in. No indeed. The religious orders have been the beneficiaries; and who leads the religious orders? The fine men and women of CORI, of course.

Well might CORI complain that "the bulk of available resources were allocated to the better off in the 1998", as if the resources of the State were a separate thing from the taxpayer who generates them. What the Budget did was not to allocate "resources" but to permit taxpayers to keep more of the money they actually earned. You know the feeling, CORI: that's what happened when the capital gains tax on your property transactions was dropped from 40 per cent to 20 per cent, as it was in the last Budget. If any of you renounced the windfall and decided to give the extra proceeds to the poor, well, it escaped my attention. That was the Budget which you now call the triumph of greed over need.

The recent woolly Human Development Report which reported that 15.2 per cent of the Irish people live in "human poverty" prompted the latest CORI suggestions that the State should guarantee an income to every adult in the state of £75 a week. A nice round figure, £75. Why not make it rounder - £100, say? Or bigger - £150?

And what, anyway, does the HDR mean by "human poverty" - which it defines by life expectancy after 60, illiteracy, long term-unemployment and, surprise surprise, POVERTY. Very enlightening indeed. So I ask again: what precisely is poverty?

Illiteracy

There is much poverty in Ireland, and we might differ on its causes. But what is undeniable in this State is that we have failed lamentably and deplorably and actually wickedly in allowing 23 per cent of our adult population to be functionally illiterate. That is a truly scandalous figure, for the victims of the educational delinquency responsible for that failure are invariably doomed to inadequate and unrewarding lives.

But who, pray, has responsibility for so much of the teaching in this State? The Government, of course, and a teaching profession which luxuriates in three- or even four-month summer holidays, never mind the numerous holidays which follow from September to the following spring; never mind PRSI rates one third what the rest of us pay; never mind index-related pensions for the rest of their lives. Who else is responsible? The religious orders, naturally, which have so rigorously protected their State-subsidised schools from actual State interference.

I don't think they're necessarily wrong to minimise such State interference. But I do wish that when these orders are making so much money from landdeals, and while so many illiterate young adults are emerging from an education system they dominate, that they would spare us their morally superior though fascinating insights on how other people should be taxed.