William Burton investigates public reaction to the imposition of the household charge in Donegal
The implementation of the household charge of €100 has been one of the most controversial aspects of the economic collapse in Ireland. With revenue sources depleted after the property crash, the government is seeking additional revenue raising powers, demanded by the European Union, European Central Bank and the International Monetary Fund after the bail-out in November, 2010.
With the collapse of the property boom in Ireland, the construction reliant tax-base was eroded and government spending increased due to increased unemployment. The household charge and the eventual property tax are to replace the exchequer element of local government finances, set up in 1999 as a source of funding for local services.
Ireland had domestic rates until they were abolished for electoral reasons by a Fianna Fail government in 1979. People are not used to domestic charges on their property in Ireland. Property related revenue funds are greatly diminished from the so-called “Celtic Tiger” period.
An energetic and dedicated Can’t Pay, Won’t Pay Campaign has resulted in over 700,000 households having not paid by the deadline date, 31st March. This in some ways is not surprising. The government rolled out the same TDs, over and over again, to try and persuade people to pay. The message was simple from the government. Local services needed to be paid for and central government can no longer fund local services such as road repairs, libraries and fire and emergency services.
The bailout by the troika (EU, ECB, IMF) was underpinned by an agreement for Ireland to implement a range of revenue-raising exercises. The household charge, to be followed next year by a progressive property tax, is just one of those exercises.
The Can’t Pay, Won’t Pay campaign is buoyed by members of the United Left Alliance and Sinn Fein who oppose the charge. Pádraig Maclochlainn, Sinn Fein TD for Donegal North East, is urging people to resist paying the household charge which he considers an unfair tax.
“The Government has chosen to implement a household charge that is regressive and clearly unfair. Our choice would have been different. We believe in a fair and progressive taxation system,” said Mr Maclochlainn.
Citizens were confused as to what the charge was for, and, because they did not receive a physical bill, there was no urgency. It is fair to say that for many citizens they felt that there was no tangible benefit in paying this charge. The people did not cause this economic meltdown, so in theory the people should not pay for it.
In County Donegal the Can’t Pay, Won’t Pay Campaign, has been especially successful in persuading people not to pay. When driving anywhere in the county there are placards and signs attached to lampposts urging people to resist and to not register for the charge. By the 31st March, 2012, 70% of homes had still not paid the charge.
Donegal County Council is urging people to pay or otherwise they warn there will be a significant shortfall in revenue for the council to provide services such as road repairs, libraries and crucially, fire and emergency services.
The clergy in Donegal have spoken up about the issue. Gaoth Dobhair priest Father Brian O’Fearraigh has urged people to resist the payment which he calls, “unfair and unjust.”
Father O’Fearraigh recently addressed a large protest in Letterkenny in which he urged people to keep fighting: “We, the people say: No to household charges. We the people say: No to water charges. We the people say: No to septic tank registration fees. We the people say: We Can’t Pay, Won’t Pay.”
The intervention of Father O’Fearraigh in the debate has been met with criticism by a local Labour Senator, Jimmy Harte, who said: “It is totally irresponsible for a member of the Church to say to people not to pay the charge.”
Referring directly to Father O’Fearraigh, Senator Harte suggested he should re-read his scriptures and remember that when the Jews did not want to pay their taxes to Caesar, Jesus said: “Render therefore to Caesar the things that are Caesar’s; and to God, the things that are God’s.” For Senator Harte, the same principle applies. “If you use the services, you have to contribute to pay for them,” said the Senator.
County Donegal will suffer if people refuse to pay the household charge, Senator Harte has warned. This in turn will put pressure on local business rates as Donegal County Council needs to raise the revenue because central government is cutting their funding for local services. “You cannot be an à la carte citizen and decide what taxes you will pay, and ones you won’t pay,” Senator Harte added.
What is clear from the debate around the household charge is that the government is not changing course like the septic tank charge. The septic tank inspection charge was significantly reduced from €50 for the first three months, to €5, due to pressure from campaign and rural living groups.
The revenue envisioned from a full, progressive property tax next year, it is hoped, will begin to reduce the gap between government spending and tax-take. The state has pledged under the EU, IMF and ECB bailout to implement a range of taxes and the household charge is just the start. Water charges will be the next hurdle for the government to overcome and persuade people that these additional taxes are needed, and will help the state build a sustainable tax-base.
It is doubtful whether the government will be seen to make any u-turn on the first stage of implementation of the €100 household charge. What cannot be in doubt is the public’s hostility towards further taxes and the furore and passion it creates.