Joan Burton (Dublin West, Labour)

I support the amendment. Given the statistics provided by the Minister on the rate of pick up of tax breaks, it would seem that some 800,000 households are not claiming tax relief on refuse charges. This means the Minister is in pocket to the tune of that amount.

The Minister recalls, I am sure, correspondence and comments about Dublin Bus. If a person overpays a bus fare, Dublin Bus gives a voucher indicating the overpayment. Money accrued in this way which is not claimed is used, to some extent, for charitable and community purposes. The question arises of what the Minister does with the extra money he is holding on behalf of taxpayers. If the facility does not exist for taxpayers to collect this money, there is a good argument that it should perhaps be distributed over and beyond the income that may be distributed by the Government to charities. The Minister is essentially holding on to taxpayers' money which rightfully belongs to taxpayers. It seems inappropriate that the Minister can hold on to this money. If he will not refund it or provide schemes for refunding it, perhaps other ways should be found to distribute it to some charitable causes.

One must also bear in mind that these reliefs are somewhat of a scam, particularly where they concern people whose income is so low that they have no tax liability. We do not operate a system of refundable tax credits. If a family has a significant number of children but the parents work at or close to the minimum wage, the reality may be that they will not have much of a tax liability if the income is very low. Therefore, the family will not be in a position to benefit from tax refunds. Despite this, these are the types of families, especially those with small children and babies, who require a refuse collection on a weekly basis, especially in the summer.

There is much dishonesty evident in this issue. In some ways, this tax break was introduced as a way of getting over the argument that there was a double taxation element in bin charges as people had already paid them through the general payment of income tax. The way the system operates, local authorities in the Dublin area attempt to charge on the double and even on the triple for refuse services.

Fianna Fáil destroyed the rates base of local government in 1977 to win a famous general election. As a consequence, the party screwed up the economy for many years. The Minister may argue that the chief architect of this debacle left shortly afterwards to join the Progressive Democrats. He may state that the destruction arising in the economy from that particular event was in many ways the product of what subsequently became the Progressive Democrats wing of Fianna Fáil.

The Minister boasts that a certain percentage of taxpayers do not pay income tax because their income is so low. However, these people are in no position to receive a refund on service or bin charges. In Dublin, most local authorities are trying to work towards a flat charge and a pay-per-lift charge. The objective is to have this weighted. It is especially interesting in the case of the local authority in Dún Laoghaire-Rathdown, where the cost has now risen to quite significant levels.

All this indicates that this matter equates to Fianna Fáil's attempt to get back to rates by the back door, as a result of what it did in 1977. Local government in Ireland has never recovered from this event. Once the idea is sold to the people that a particular form of taxation is to be abolished, it becomes impossible to go back. The old rating system had many elements which were extremely unfair nonetheless. We are now in a logically absurd position with regard to a number of these matters.

The easiest action to take would be to give people at the point of payment a tax credit for bin charges. Perhaps the moneys could be refunded directly at the point of purchase of bin services by the local authority. The authority could then be reimbursed by the Department of Finance. This would ensure that a very high percentage of the tax credit would be refunded to people. It may also be cheaper to do this from an administrative perspective.

I support the amendment put forward by Deputy Bruton. If we are logical about the tax system, it is the responsibility of the State to find a way of refunding tax credits to people who are lawfully entitled to them. We have a system which pays lip-service to this. In theory there are many tax credits, but in practice the majority of people in the case of bin charges fail to make use of them. It is most likely that it is people with accountants who gain the benefit of the tax credit, even though they may require tax relief least of all. We are in a logically absurd position.

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