The International Monetary Fund has said Ireland should gradually increase taxes after next year, once an economic recovery from Covid-19 lockdowns has taken hold.
Reviewing the health of the Irish economy, the IMF said raising taxes would be necessary to fund investments in human and physical capital, with housing, education, childcare and training particularly high on the list of spending priorities.
Funding such spending was vital to maintaining interest from multinational corporations according to the IMF, as it recommended broadening the country’s tax base to achieve these goals.
Housing solutions would require a “multi-pronged” approach, the review states, freeing more land for residential use and making the planning process more efficient.
Whilst warning against withdrawing Covid-19 supports and payments too soon, the group signalled that Ireland must prepare for the possibility of a global corporate tax rate, in “an extreme scenario” that could see €5 billion lost in tax receipts here.
Newstalk’s Shane Coleman said “nobody in politics wants to talk” about paying for not only the €28 billion cost of Covid-19 lockdowns, but also the possibility of losing half of Ireland’s corporation tax base.
“We need to have a mature debate about it that doesn’t involved screams of austerity every time it’s mentioned,” Coleman said.
“The Left in this country are a joke. They want full services, and that’s fine…but who on the Left in particular, and it’s not them exclusively, is going to tell us how we should pay for this?”
When presenter Ciara Kelly said the Left would suggest “wealth taxes and higher taxes on those who earn over €100,000 a year”, Coleman replied that the idea was “BS”.
“There is no magic money tree that is going to produce…a wealth tax is not going to produce that kind of money and anyone who thinks that is in cloud cuckoo land,” Coleman insisted.
“It means talking about a proper property tax, it means talking about other charges…water charges…how are we going to pay for the infrastructure we need for our water.
“Nobody wants to talk about these issues. We’re going to have to talk about them…there’s going to be skin and hair flying.”
Welcoming the IMF reports, Minister Paschal Donohoe said issues such as climate change also had to be addressed.
“We must also consider issues such as the financing of Ireland’s transition away from fossil fuels to a low carbon economy. The scale of the climate change challenge is very significant and will involve transformative change for all sectors of the economy,” he claimed.