Tag Archives: tax

Irish Water Tax to be introduced in 2014

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A new tax on the private use of tap water is to be introduced in Ireland in 2014. This is despite the fact that most Irish homes will not have an actual water meter installed until 2016 at the earliest. A flat-rate fee will be introduced initially and will be based on the size of a property as well as the number of occupants.

Irish businesses already pay for their water usage but private homes do not, the funding for which comes from general taxation revenue. The new plans to install a water meter in every house in the country have, like the property tax, been greeted with dismay by a population that is already groaning under the weight of a huge and increasing tax burden. It is expected that average annual usage per home would cost approximately 400 euro (approx US$530), with heavier users paying more.

It is broadly accepted that there is a case for charging for water usage. Estimates put the wastage of usable water at over 50% from the country’s creaking and in many cases Victorian water pipes network. Owners of rural houses usually have to sink their own well or else join a water scheme while urban houses do not have any such expense so there is a real urban/rural divide on the issue.

On the other hand Taxpayers can reasonably argue that they already pay for water in their income and sales taxes and are entitled to ask just why they are being told to pay again.

Edited by Michael Green
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Controversial Sugar Tax to be introduced into Ireland

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The Irish government looks set to follow the lead of several other countries and introduce a tax on sugary soft drinks such as lemonade and cola. It is expected that the tax will be a 10% hike in excise duty which would add about 20 cents to the cost of a 250 cents bottle of soda. The government is torn between wanting to reduce the intake of fattening foods and drinks in the general population while also not wanting to damage employment and add to household bills.

Efforts in Ireland to decrease the consumption of certain products by taxing them have had only limited success. Over the decades there have successive small increases in the price of cigarettes and alcohol. The tax hikes on cigarettes have very much outpaced those on alcohol and certainly do have an effect on consumption, especially when combined with the ban on smoking in the workplace and the current societal disapproval of tobacco. The overall momentum against smoking allowed successive governments to tax cigarettes heavily.

The same cannot be said about alcohol consumption. The policy of continually raising the tax on alcohol in small amounts has not had any great effect on consumption. Critics of the policy advocate for a single very large increase in tax on alcohol, perhaps even to increase the price by 50% or 100%, in order to have any kind of real shock impact. The revenue raised from this tax could be used for health education programs and even to fund hospital emergency departments that are inundated with alcohol-related patients every weekend.

The need for action in the food and drinks sector is now obvious. 60% of the Irish adult Irish population and nearly 25% of all 7-year-olds are classified as being either overweight or obese. By any measure this is a shocking statistic and is a recipe for a diabetes epidemic in the years to come, along with a whole other raft of health problems.

The introduction of a sugar tax on certain flattening products is likely a good idea, but unless it is of a sufficient amount then it seems certain that its impact will be minimal.