Punitive taxation against developers and bankers?

[New_Economic_Agenda]

I was struck last night by the view of one public service worker interviewed on the Nine News when he said 'the public service should not be made the scape goats for the wrongs of the developers and the bankers' or words to that effect.

If we assume that this view represents one of the core messages which the Public Sector Unions will now convey to their membership, and thus encourage debilitating industrial action across the state, it raises the following questions:

(a) how can the developers and bankers be punished without undermining an already fragile economic outlook?; and

(b) more theoretically, are we now seeing the beginnings of a call for a system of punitive taxation in the state?

Any Views?

[bobbysands81]

On the day the Govt announces a 15% pay cut for ordinary workers they hand €8bn to the banks to prop them and the builders up!

Corrupt as ********************!

[ivnryn]

I was struck last night by the view of one public service worker interviewed on the Nine News when he said 'the public service should not be made the scape goats for the wrongs of the developers and the bankers' or words to that effect.

If we assume that this view represents one of the core messages which the Public Sector Unions will now convey to their membership, and thus encourage debilitating industrial action across the state, it raises the following questions:

(a) how can the developers and bankers be punished without undermining an already fragile economic outlook?; and

(b) more theoretically, are we now seeing the beginnings of a call for a system of punitive taxation in the state?

Any Views?

By 'punitive taxation' do you mean something like

"A financial stabilisation levy will also be applied to anyone working in the banking sector for more than 2 years over the last 4. The percentage of the levy will be based on the highest annual income the person received, during the assessment period, including bonuses, during that period, ranging from 5% for assessed incomes below 30k to 15% for assessed incomes above 500k"

[Dios]

(a) how can the developers and bankers be punished without undermining an already fragile economic outlook?;

Developers and banks are two unque entities, so thats actually two questions. First of all the developers added nothing to the economy, residential property adds nothing to the economy. Every penny spent on it at the end of the day is borrowed from future earnings with massive interest. We'll be paying the price for that for decades to come, moving the situation from a farce to a tragedy.

Seondly the role of the banks in the economy needs to be reduced. I'd think about setting up a common stocks market for easy investment into businesses via credit card, and the setting up of a credit beareau which would act like a pension fund except its job is to step in if the banks ever think about not lending to small businesses again.

(b) more theoretically, are we now seeing the beginnings of a call for a system of punitive taxation in the state?

Punitive taxation is all over the place. Cigarettes, booze, car tax based on emissions, its nothing new.

[Dios]

Yep, don't forget we also need to keep the 'international investors' happy too.

There were very very few international investors in the property boom. The kept away like the place was plagued, wisely enough.

[_soma_]

'the public service should not be made the scape goats for the wrongs of the developers and the bankers' or words to that effect

I think a lot of people are struggling to connect the dots between the expansion of our economy via unsustainable short-term mechanisms (i.e a bubble economy) - and the increase in size of the public service during that time.

Without this false economy those extra positions in the public sector would not have been created.

Now that it has exited stage-left.. .. ..

[New_Economic_Agenda]

Developers and banks are two unque entities, so thats actually two questions. First of all the developers added nothing to the economy, residential property adds nothing to the economy. Every penny spent on it at the end of the day is borrowed from future earnings with massive interest. We'll be paying the price for that for decades to come, moving the situation from a farce to a tragedy.

Seondly the role of the banks in the economy needs to be reduced. I'd think about setting up a common stocks market for easy investment into businesses via credit card, and the setting up of a credit beareau which would act like a pension fund except its job is to step in if the banks ever think about not lending to small businesses again.


Punitive taxation is all over the place. Cigarettes, booze, car tax based on emissions, its nothing new.

The credit bureau is interesting can you elaborate?
As regards the developers, I accept your point, but the question is how does the state penalise? Through proper and adequate enforcement of company law? By breaking the corporate veil? - i.e. Can the notion that a company is an entity separate and distinct from its members continue to hold? It clearly doesn't within the auspices of the Criminal Assets Bureau, so should something similar be set up on the company side - something to give the Director of Corporate Enforcement real teeth ??

[Dios]

The credit bureau is interesting can you elaborate?

Well two of the major problems with the banks right now are the flow of credit to small businesses, and the holding of deposits. While deposits vanishing presents a huge issue, its not an ongoing issue - either it happens or it doesn't. That can be resolved by increasing the amount that banks are required to hold relative to their loans, and improving regulation of said loans (removal of Pfandbrief style securitisation for a start).

The idea of a credit beaureau would be to ensure that businesses which depend on credit would not be left to founder in the event that the banks stop lending again. This is an event which pushes recessions into depressions. Generally speaking these are small, relatively short term loans, which should be adequately covered by a fund whose express purpose is to be held in order to reduce the role of banks in day to day business.

U]how [/U]does the state penalise?

No penalty is required or desireable beyond the removal of the many and various state aid and grant schemes intended to prop up the property market in this country. Once that is done equilibrium will be reached between natural supply and demand, a couple of years later, and the problem resolves itself.

[New_Economic_Agenda]

By 'punitive taxation' do you mean something like

"A financial stabilisation levy will also be applied to anyone working in the banking sector for more than 2 years over the last 4. The percentage of the levy will be based on the highest annual income the person received, during the assessment period, including bonuses, during that period, ranging from 5% for assessed incomes below 30k to 15% for assessed incomes above 500k"

You have to wonder why there aren't protests on the streets

[DaveM]

On the day the Govt announces a 15% pay cut for ordinary workers they hand €8bn to the banks to prop them and the builders up!

Corrupt as ********************!

Two questions.

Who exactly has received a 15% pay cut?

Do you think it would be better if the government did not recapitalise the banks and they are allowed to collapse?