This week the emphasis of the lectures looked away from the environment and its resources but focused more on the global economies and the Irish economy. We were asked collectively as a class what was our views and opinions on taxes. The main suggestions were that most were happy to pay them but there was an under-lying feeling that no-one knew exactly where their hard earned money actually ends up.  Everyone knows that taxes are a way of life , taxes are the main source of incomes for our goverments and without them the countries infrastructure , public and private sectors would be derelect. Many queations were put towards us

  • is the taxation system fair
  • are we taxed too much or too little
  • is there any alternatives
  • are we happy to pay taxes
  • could the money be put to better use

These are tough questions that can give alot of different opinions and views. As one of the younger students of the class my experience and opinions may be very different to those who have been paying large sums of their annual incomes for years towards tax. Personally I think taxes are very important and must be payed for the country to run. It is a very touchy subject for goverments as it is always dangerous to raise taxes as no-one wants to pay more. On the contrary to what sum may believe I think different rates of tax is the fairest , altough they should be calculated in the most fair way possible. I believe a new higher rate of tax should be introduced to the countries richest in the region of 47%-50% and the cap at approx. the 300,000 annual income mark. This is my view altough i do respect the fact that some in the class believe a higher rate would be unfair.

Altough it seems no-one will ever agree entirely on the tax system it does seem clear that in geneal most people are happy to pay it as they realise it’s importance. One theory put forward which I found interesting was that it seemed in Ireland people of possibly older generations never liked the idea of taxes as in Ireland for generations taxes were always payed to the “Crown” as we were ruled by the british and that it was installed in peoples mines for hundreds of years that tax was a bad thing to be avoided. Altough this obviously isn’t a topic to concern us knowadays , the idea of tax dodging and people avoiding taxes  is a global problem as well as here in Ireland.

One well documented example of this is that U2 frontman “Bono” of coarse pays little if no tax to the Irish goverment as his profession is that of an artist, which have no guarenteed income so can apply to have tax cuts. This seems ludicrious but is entierly legal , this is just one of the many loop hole that the worlds richest seem to find everyday. For many people especially with substaintial incomes try to find ways of avoiding taxes as they try to “hide their money”. This can be done in many ways but the most known is to put money in off-shore accounts in countries which are regarded as “Tax Havens”. According to Wikipedia.com a tax haven is defined as

A tax haven is a state or a country or territory where certain taxes are levied at a low rate or not at all while offering due process, Good Governance and a low corruption rate.[1] 

Individuals and/or corporate entities can find it attractive to move themselves to areas with reduced or nil taxation levels. This creates a situation of tax competition among governments. Different jurisdictions tend to be havens for different types of taxes, and for different categories of people and/or companies.” Such examples of tax havens are Switzerland , The Caman Islands etc… Countries known as tax havens can have a negative impact on their international relations.

There is one figure that almost all Irish people know , and that is the rate of corporation tax of 12.5%. For many years this low coporation tax has lured foreign investment into the Irish economy along with many MNC’s such as DELL , Intel , Pfizer etc.. setting up their european headquaters. Unfortunately due to this low rate of tax some beleive that Ireland may infact become seen as a tax haven which may have adverse impacts to the economy.

Possibly one of the main issues of tax is that no-one really knows precisely where or how there money is spent by the goverment. It regulary angers people when they hear of politions freely spending thier money on lavish things such as cars houses etc.. when the bill is payed for by everyone else. Altough  I imagine it must be very hard for even the tax consultants to track down whos money is who , people seem to want to know if it is spelt on healthcare , infrastructure or something they may not support such as war or back to the example of beeing squandered by politions.

 

Do you have a negative view

of TAXES???

 

 

 

 

 

This is raises the questions is their alternatives to taxes. Some people seem to forget that everyone pays taxes all the time , whenever they make a purchase , or buy products from abroad due to excise duties , VAT etc… On the topic of VAT  I find it quite confusing to see what determines a luxury good and a necessity item . Shelia Killian informed us products such as caviar are classified as essential while all types of everyday goods such as ketchup is a luxury. It is always hard to find alternatives altough one succesful scheme by the goverment was to introduce a tax on plastic bags. This was introduced to help with the rubbish problem as these bags are non-biodegradable. The solution provided was that all major shopping outlets must provide an alternative such as “the bag for life”. This was succesful as the alternative was there for replacement. Other issues such as rising petrol costs so as to raise numbers useing public transport are harder to see if can be succesful.

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