For Raw Hides

Admin at 11:14 am May 17, 2016

‘sup?

Charmaine Kenny at the Irish Workshop [online home of Irish crafts and whatnot], writes:

It’s udderly ridiculous how crazy we are about cows here at The Irish Workshop; it’s just that cows are very amoosing and we’re particularly fond of Brigid Shelly’s ‘cowshions’.

Many of the designs are inspired by her bovine neighbours where she lives in Waterford.

Take for example Pandora (above in pink) – she is born and reared in Ardmore on Joe Murphy’s farm down the road from Brigid. She isn’t your typical country cow. A self-proclaimed fashionista, she enjoys the finer things in life and has a weakness for single malt whiskey….

Hic.

The Irish Workshop

Irish made stuff to broadsheet@broadsheet.ie marked ‘Irish Made Stuff’

Twink On Fire

Admin at 10:44 am May 17, 2016

Last night.

On RTÉ 2’s Republic of Telly.

Sarah Neville writes:

The battle to make it to Eurovision 2017 has already begun in RTÉ, and our Joanne roped in entertainment extraordinaire TWINK for some help!

The final episode of this season’s Republic of Telly is on next Monday at 10pm on RTÉ2.

No Absence Of Malice

Admin at 10:19 am May 17, 2016

From top: Michael Clifford, Colette Sexton and Gavan Reilly; Vincent Browne

Further to the statement Garda Commissioner Nóirín O’Sullivan released last night – in which she stated:

“I want to make it clear that I do not – and have never, regarded Sergeant McCabe as malicious.”

Vincent Browne discussed the matter with his panel on TV3’s Tonight With Vincent Browne last night.

The panel included Irish Examiner journalist Michael Clifford, who last week reported that Ms O’Sullivan’s senior counsel Colm Smyth told Justice Kevin O’Higgins – during his Commission of Investigation into Sgt Maurice McCabe’s complaints – that McCabe told two officers he was acting out of malice.

The allegation was proven to be false after Sgt McCabe produced a recording of his conversation with the two Gardai – and the episode wasn’t included in the final report.

Mr Clifford reported:

The documents show that, at the commission, Mr O’Higgins asked the commissioner’s lawyer whether “you are attacking his [McCabe’s] motivation and attacking his character”.

The reply from Colm Smyth, SC, was: “Right the way through.”

He told the judge that he was acting on instructions.

This morning, Mr Clifford reported that after he received a draft of the O’Higgins report, he threatened to get an injunction against the publication of the report – because the episode wasn’t included.

Colette Sexton, of the Sunday Business Post and Gavan Reilly, of Today FM were also on the panel.

Grab a tay…

Gavan Reilly: “On the question of who was acting on whose instructions, by the way, Vincent, it’s worth bearing in mind that the senior counsel involved in this particular exchanged that formed Mick’s story on Friday. Not only were they hired and instructed by the Chief State Solicitor but they were the same legal team that represented not only Noirin O’Sullivan but the two former commissioners Fachtna Murphy and Martin Callinan and all the other members of the Gardai who were implicated by Maurice McCabe’s allegations the whole way down so…”

Talk over each other

Vincent Browne: “That makes it even more confused because it could have been somebody else that…”

Michael Clifford: “No, the counsel was specific on whose instructions he was representing.”

Browne: “On what basis are you saying, are you asserting this?”

Clifford: “I’m asserting… it was in the story on Friday. He was asked was it the Commissioner that wanted to follow this line and he said, he was operating on instructions.”

Browne: “I know but where do you get this from?”

Clifford: “It fell off the back of a lorry, I mean what do you expect me to say to that?”

Browne: “Have you two…have you, I assume that it fell, let’s assume it fell off the back of a lorry. But then did you, did you independently confirm that what fell off the back of the lorry was true?”

Clifford: “I am 100% secure and confident in the veracity of that story that was published.”

Browne: “All right, tell us about this story that you have in the Examiner tomorrow, the ‘McCabe threat to injunct inquiry report’. What’s that?”

Clifford: “This is, when the draft report, as I understand it, was released, Sgt McCabe was, as I understand it, very perturbed because he felt that it was entirely imbalanced and that one of his main issues with that was the fact that this matter was not included, at all, in the draft report. As a result of that he was minded to take a legal action, to injunct the report. We saw something similar in the Moriarty draft report, where there was a similar scenario. Now, ultimately, they didn’t do that because the costs would have been so prohibitive. But I think it just demonstrates how perturbed he was that this matter in particular, I think there may have been a few others but this was one of the main reasons…”

Browne: “Which matter are you talking about?”

Clifford: “The matter about the….”

Browne: “The malice issue, yeah.”

Clifford: “The attempt to impugn his character that this hadn’t been included in the report and I have to say, just looking at it, there’s a question there for Kevin O’Higgins. Let’s for example assume that he had, Sgt McCabe didn’t have a tape recording of that and that officers came in and said he had expressed malice, would that have been in the final report? Would it have…we’d have had a very different report, remember, completely. You’d have had a report that suggested that McCabe had brought forward these allegations on the basis of malice and therefore they had to be treated on that basis and seen in that light. That’s the kind of report you’d have had if hadn’t protected himself with a tape recording. And would have that have been included? And if so, why was it not included as it emerged here.”

Reilly: “It does raise the other question though as to whether the inquiry would have been allowed to include that, if, as you mentioned, that if it was included on the basis of arguments by lawyers and not by evidence from witnesses. That if this was something that was brought to the tribunal only by lawyers chatting among themselves really..”

Clifford: “Oh yeah but surely…”

Talk over each other

Clifford: “There’s an indication that there’s going to be evidence to that effect, and then the tape recording was produced, surely it was still incumbent to hear the evidence to see what was going to be said…”

Browne: “OK, we gotta take a break but I think, just before we go to a break, it’s fair to say that yes, questions arise, further questions arise that the Garda Commissioner has got to address but I think it’s fair to say that, given her record and given her stature and known integrity, that it’s very unlikely that she is telling a lie about a matter as central as this to the whole O’Higgins’ report.”

Watch back in full here

Previously: ‘I Have Never Regarded Sgt McCabe As Malicious’

Nóirín’s Disgust

Bleak Business

Admin at 10:09 am May 17, 2016

From top: funeral procession, Inisheer Island, Aran Islands, Co Galway, 1968; Michael Taft

Raising the inheritance tax threshold will have no impact on a significant majority of households.

Michael Taft writes”

The Programme for Government has provision for cutting inheritance tax. This is bleak business. Cutting inheritance tax will be a bonanza for high-income groups.

Welcome to the new politics, inseparable from the old politics.

The Government proposes to increase the tax-free threshold from the current €280,000 to €500,000. The regressive impact can be seen from this simple example. I inherit €500,000. Currently, I would pay 33 percent on the amount exceeding the threshold; that is €220,000.

My tax bill would be €72,600. That is an effective tax rate of 14.5 percent. That’s not a bad deal (and arguably already too generous): I inherit half-a-million Euros and keep 85 percent of it after tax.

Under the new proposals, I would pay nothing.

There are many arguments for cutting inheritance tax but the most unimpressive is that it would somehow benefit low and middle income earners.

The fact is that most people don’t have even the current threshold to give away in an inheritance.

The median net wealth (wealth after debts) for those aged over 64 years is €202,300. This means that 50 percent of this older-age group has net wealth less than this amount.

That includes both financial and real (property) wealth. It is reasonable to assume that a significant majority have net wealth holdings of less than the current threshold of €280,000. Of course, not all disponers come from the older-age group but probably a majority does.

When we look at the national numbers we can get data on income distribution. The following table shows the median net wealth by quintile – or tranches of 20 percent.

The top 20 percent income earners have a median net wealth of €207,000 (again, meaning half of this group have a wealth of less than this amount). T

hroughout the state, half of all households have a net wealth holding of less than €103,000. [Note: the lowest income group has a median net wealth holding higher than the 2nd quintile; this can be explained by the fact the lowest group would contain older age groups reliant on state pensions but own their houses).

Based on this, it is reasonable to assume that raising the inheritance tax threshold will have no impact on a significant majority of households.

Even if a household has a much higher level of wealth than the average, raising the thresholds may have little impact. I may pass on €500,000 on an inheritance but if I divide it equally between my two children, then they won’t be liable to tax under the current threshold.

Some argue that the gift/inheritance shouldn’t be taxed because it has already been taxed. This is debateable for two reasons. First, it is taxed in the hands of the recipient who, by definition, is only receiving it for the first time. Second, income is subject to multiple taxes (or double/triple, etc. taxation). I pay income tax on my wage.

But I also pay USC on my wage; and PRSI. After tax, I continue to pay taxes – VAT, excise taxes, levies (ATM withdrawals, etc.). And the after-tax income that I spend in the shops is also subject to taxation; corporate tax for the business and income taxes for the employees. And so the cycle continues.

Still others have referred to the situation whereby a son/daughter inherits a house – but is forced to sell the ‘family home’ to pay the tax bill. Is this just anecdotal?

I receive a house in an inheritance. If I already own a home, I have inherited a second home (adding substantially to my wealth). I can either rent out the house, earning income; or I can sell it. Either way, I receive a substantial gain – even after the tax bill.

If I rent, I can move into the house with full equity and increase my income through reduced rent payments. The tax bill is a once-off, my rent reduction is permanent. This is not to say there are not issues regarding inheritances and payments – I look at some of them below. But gaining a house through inheritance is a gift of a substantial asset.

The cut in inheritance tax is estimated to cost €75 million, not a trifling sum. However, the real issue is that ever since estate duties were abolished and replaced by the Capital Acquisitions Tax, inheritance tax revenue has been subdued.

There is a strong argument for an increase in inheritance and gift taxes, especially give these tight fiscal times.

This argument gains force when we consider that this is a tax on unearned income. We tax unearned income so that we don’t have to impose that amount on earned income – a PAYE wage or the income of the self-employed or a business.

Economic efficiency would see higher, not lower, taxation on unearned income.

There are three issues that could be considered in the context of a more progressive inheritance tax regime.

First, is the issue of inheriting a house; currently, there is an implication that a child who is living in the ‘family home’ can only inherit tax-free if the parent is not living in the house (in other words, the parents have two houses).

There are exceptions for those caring for a parent. If there is a problem in this area it should be cleared – so that a child living in the house, with conditions, is not barred because they share the house with the parent.

Second, consideration should be given to extending the situations whereby the inheritance tax can be paid over 60 months.

Third, prior to 1999, there are varying rates for inheritances – ranging from 20 percent to 40 percent. This added a progressive element to the tax. Reintroducing a low rate and top rate could also be considered.

But if we entering into an era of ‘new politics’ then the Government should bring forward evidence as to the distributional impact of cutting inheritance tax – who will gain and by how much?

Is this a transfer to high-income groups from the rest of us?

In any event it will be interesting to see how the Government squares this commitment to cut inheritance tax with a commitment in the Government programme to poverty-proofing new policies.

I suspect it can’t be done.

Michael Taft is Research Officer with Unite the Union. His column appears here every Tuesday. He is author of the political economy blog, Unite’s Notes on the Front. Follow Michael on Twitter: @notesonthefront

Pic: James Sugar/National Geographic