This week brought the first draft, but I’m not allowed to turn on the heating until Housekeeping Day when we know what support is coming.
It’s good to know that middle-down help is in the mail, but will it be enough?
Something was pushed through my mailbox on Tuesday, which made me uneasy. No, not the gas bill – the alert pack will be emailed to you soon.
I came back from the supermarket with a bad feeling – everything has gone up in price – to find that this year’s colorful Smyths Toys catalog had landed. Christmas is more than three months away, but I still hesitate to pay for the children’s activities.
It feels privileged to moan about things like hockey, but the bills feel particularly adamant this year knowing it’s going to cost a lot more to heat the gaff.
I’ve considered throwing it away, but the catalog offers hours of screen-free entertainment, so I’ll wait until September 27th.
There are households that don’t care about Budget Day – but a new one Sunday independent Surveys found that just 7 percent of people are not concerned about allegedly higher energy bills, and nearly half have trouble paying their bills in general.
According to the National Statistics Office, households saved an average of 19 percent of their income in the first quarter of 2022 – almost double the pre-Covid figure. Some households are rolling in it, but to me this suggests that most are just fearful of a recession and are therefore forgoing spending to pump up their reserves.
This year’s record budget will get people tuning in who might not have cared in years past, when inflation was low and energy prices predictable. Widening the tax band would help many in the squashed middle — around a million people.
Irish taxpayers pay marginal tax rates of 48.5 per cent on salaries over €36,800 and 52 per cent over €70,044. Colin Forbes, Deloitte’s tax partner, recently informed me that Deloitte’s pre-budget proposal stated that these tax rates were not competitive compared to other countries inside and outside the EU.
A focus of this year’s budget will be family support, so the Wanderkindergeld – and here a double payout – would soften the blow. There are a few decommissioned facilities that could be revived. Rent and mortgage relief, of course, but there are others. The budget negotiations are in full swing: What will help families who are against it?
It makes sense to what Sinn Féin CEO Mary Lou McDonald said this week about capping electricity prices, but linking payments to income doesn’t take into account the number of people in a household who depend on that salary.
It’s easier to give it to everyone and try to siphon it off for the very rich through other tax measures.
We heard this week that EU energy ministers will seek to approve bloc-wide measures to cut gas and electricity prices at an emergency summit on September 30.
Countries would have to reduce their power consumption by 5 percent during peak periods. So, alongside energy credits, could we introduce financial incentives to encourage saving?
There’s nothing quite like the thought of saving money to get people to act.
I’ve been thinking about why skyrocketing energy bills people fear, and it’s not the fear of being cut off – you can arrange a payment plan with your provider. But the thought of not being able to pay your household bills when you were previously a manager comes as a huge psychological shock.
To work from home
What we have is too restrictive. This pre-budget submission by Deloitte proposed a €1,000 tax credit, which can be reduced pro rata based on how many days you stagger into the office. Or, alternatively, remove the 30 percent cap on expenses – like broadband and heat – and allow a credit at the 20 percent tax rate for the full amount.
Trash cans and non-routine dental work
Garbage fees have risen – costs that cannot be avoided. There used to be a universal credit for bins and services worth around €100, so why not revive it? Fees for inpatient and outpatient hospital stays can be abolished – welcome – so cardless parents rushing to Crumlin with a sick child will no longer be handed a £100 bill.
But why not increase tax breaks for non-routine dental work as well? This is granted at the relief rate of 20 per cent but used to be a full deduction at the maximum rate. There is a precedent: Certain nursing home expenses are granted at the marginal rate.
This is the high end of the squashed middle, but this category is now squashed. Ask any parent whose child needs braces if they can easily afford them.
This should rightly be a spending priority. I feel for families who pay big bucks for childcare, but it annoys me that the conversation usually focuses on preschoolers. And it’s not just the cost. Try to find a childminder in Dublin.
If I had the budget purses in hand I would also fund primary schools to offer afternoon clubs (ideally we would have a longer school day but we can only dream). It would pay off as more women would work and pay taxes if the school picked up at a reasonable hour.
A few months ago I read an article by an economist who marveled that the labor force participation rate of women in the republic has lagged behind that of the north for decades, even though childcare there is not noticeably better and more women here have degrees.
But it’s very simple: reconcile our primary school day with the longer day in the UK and you’ll have more working women.
Let’s hope this Budget Day provides families with a solid foundation for stress-free turning on the heat and hiding the Smyths Toys catalogue.
https://www.independent.ie/opinion/comment/why-a-smyths-toys-catalogue-put-the-fear-of-god-in-me-in-the-run-up-to-budget-day-41990218.html Why a Smyths Toys catalog in the run-up to Budget Day made me fear the Lord