Maureen O'Sullivan (Dublin Central, Independent) | Oireachtas source

First, I acknowledge the amazing work done by the PBO in making what is involved in the budget and the Finance Bill accessible in readable English. Not everybody has a background in economics or finance. There are some general points from the work the PBO has done that are important to take on board and make a reality. One question is about the timing of its work, which depends on the timing of the work that goes to the office from the Departments. This is a vital matter if we are serious about scrutiny of the budget. There have been nine budgets during my time as a Member and I often wonder about the wisdom of the instant reaction to the budget. As soon as the Minister makes the speech, we are handed a massive tome on the budget and there is an instant reaction across the House. How does that qualify as real scrutiny at that stage, especially now that we have the services of the PBO to contribute to the scrutiny? That office tells us there is scope for greater use of evidence in public policymaking. When we get the budget, we also receive the Supplementary Estimates. We know that approximately €700 million more will be required for the health Vote later this year. One has to wonder how many other Supplementary Estimates will be introduced that are not taken into account at the initial stages.

It is not just the PBO that is indicating a need for caution on Brexit in the budget. Economists and other groups are saying the same. Companies and organisations are feeling the negative effects of Brexit. I accept it is difficult to prepare for all types of Brexit but the worst-case scenario must also be addressed. Economic growth is expected in the short and medium term but if Brexit is not orderly, it could be disruptive and have dreadful effects on trade. Hard Brexit and no-deal Brexit must also be considered, but they do not appear to have been.

The first aspect of the Bill I will discuss is corporation tax. I voted for the exit tax on the transfer of assets overseas because there have been examples of foreign companies coming here, availing of all we have to offer in terms of tax breaks and incentives, an educated labour force and so forth, and then moving on because they got a better deal somewhere else. Corporation tax provides 13.2% of Exchequer revenue. It is not sensible to rely for revenue on a source that is not consistently reliable in the long run. This is a small number of foreign national owned multinationals whose employees are also responsible for contributing significant income tax and so forth. The corporation tax figures must be more transparent and accessible. We have to know what the minimum effective rate is. We are advised that it should be 6%, but there must be more transparency around this.

As regards taxes generally, our overall tax take remains lower than that of most of our EU peers. Our ranking is tenth. Remaining a low-tax economy will have repercussions on the economy, society and infrastructure. We are aware of the demands and needs, particularly in health and housing. There appear to be positives with capital gains tax but only if one is the child of parents. There is nothing except bills and high taxes for people in Ireland who do not have children. This is a glaring injustice to a section in society. These people have worked, paid their taxes, were able to buy a house or property and were able to save, but they have no children. They would like to leave their property to a relative or friend without that person having to pay exorbitant tax bills. There is an injustice here, and it is a penalty for not having children.

There are positive aspects to the Bill. There are some increases, which are always much more welcome than decreases. I refer in particular to the Christmas bonus. It was most unfair when it was removed. Its loss and then its restoration made a significant difference. With regard to the rent-a-room relief, I have met a number of people who rent a room. Some of them are elderly and living alone and it has been invaluable to them not just in terms of the extra income it provides but also in terms of company. However, there are some who have difficulty with taking in a student full-time and an occasional Airbnb rental suits them better. I hope they will not be persecuted. The single rooms in their houses are not contributing to the housing crisis.

As regards the increase in the price of tobacco, earlier we discussed the Sale of Illicit Goods Bill. There is an almost annual increase in the price of cigarettes but it has not led to a massive decrease in the number of smokers. The awareness campaigns, incentives and assistance to help people to stop smoking are much more valuable. The price increase can be a prohibitive factor but it would be good if the yield from the increase was given to those campaigns. Lung cancer remains the main cancer killer for both men and women but it has been getting less public and political attention than other cancers. There could be potential for the increase to be directed accordingly. The increase in tobacco price is increasing the sale of illegal cigarettes, which we discussed earlier. That is thriving in parts of Dublin Central. The retailers who are tax compliant and employers and are selling a legal and controlled product are losing out while the illegal sales are continuing. The Healthy Ireland survey of 2018 shows the stark reality that the percentage of smokers in deprived areas is 10% higher than the rate in better off areas. They are the smokers who will buy the illegal cigarettes.

The tax on sugar sweetened drinks is welcome, but it is just scratching the surface of the obesity problem among children, teenagers and other groups living in certain areas of Ireland due to fast foods, lack of exercise and pastimes that increasingly involve gadgets and sitting. The ban on running and jumping in playgrounds and school yards is health and safety gone mad and arises from the insurance claims for ordinary and natural accidents resulting in sprains and breaks that are relatively easily healed. There is a need for joined-up thinking among Departments, including the Department of Finance and the local authorities, on how the budget could address the issues Healthy Ireland has been highlighting, be it in the form of incentives or otherwise.

There was certainly a case for the increase in VAT for some sectors of the hospitality industry, but there should have been some positive discrimination in favour of smaller businesses, whether in Dublin or outside it. I refer to the smaller hotels, restaurants, cafés, coffee shops and so forth. It was unfair for them because some of them are experiencing a great deal of difficulty recruiting staff. Part of that is due to the dropping of the apprenticeship scheme that had been in operation 20 or 30 years ago. Accommodation is another factor that affects their recruitment of staff. The jump from 9% to 13.5% will be difficult for smaller businesses. I have also been contacted by hairdressers. Many of them are on a low income anyway so when the VAT is increased that will be passed on to customers. Customers may feel the increase is too much and stop using the service which, of course, will lead to a loss of employment. VAT is a key element in Exchequer funding, and, in 2017, it amounted to €13.3 billion. The PBO is warning about Brexit, and if there is no agreement between the UK and the EU our VAT system will be exposed to tax competition and the possibility of fraud and evasion relating to cross-Border trade with the UK and Northern Ireland.

Another aspect of the VAT regime relates to therapy sessions with qualified counsellors and psychotherapists. There is much emphasis on the need to look after mental health by encouraging people who experience anxiety, depression or other issues to see a counsellor or a psychotherapist, instead of the pill for every ill syndrome that we had previously. I do not understand why these qualified counselling services are not considered medical care. We could broaden the definition of "medical care" to bring it more in line with the philosophy and ethos of A Vision for Change.

A 1% increase in the duty on retail betting is proposed. The larger betting companies will be able to absorb that as their retail presence means a much wider margin spread. This measure will hit smaller retailers disproportionately. Businesses may close, affecting local jobs in communities. We are aware of the increasing problem of gambling addiction, but that addiction is not seen a great deal in those small bookmakers where somebody will come in and spend a few euro occasionally or a few times a week.

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The industry tells us it is trying to address addiction by offering self-exclusion and assistance to those who are addicted to gambling but I believe the industry could do a lot more. The major contributor to gambling problems and addiction is online, phone and app gambling. This service offers credit incentives, 24-7, for 365 days a year. A person could gamble online 24-7, for 365 days a year on his or her laptop. The person could be on a laptop at 3 a.m. This service is offered by the bigger retailers. Contrast this scenario with the person going into the local bookies with a few euro for a bet. We know where the problem lies. We need to tax online gambling. Why not a duty on profit as opposed to turnover?

The Healthy Ireland survey, which was launched this morning, tells us that people in deprived areas are more likely to engage in risky behaviours such as binge drinking, smoking and unhealthy eating. It is all damaging to health. One third of those who live in deprived areas have a long-standing illness compared to less than one quarter of people in other areas. The report says that the Government's Healthy Ireland framework seeks to reduce the inequalities that exist. Where is this provided for in the budget? Where are the measures that will contribute to a healthy Ireland, regardless of where a person lives and regardless of a person's financial circumstances? The number of smokers in deprived areas is 10% higher than in other areas. This is fuelled by the increase in illegal cigarette sales.

According to the ESRI, the austerity budgets hit certain sections of the country harder than others. Budgets since then have been trying to redress that. The International Day for the Eradication of Poverty is 17 October. The mantra for this day is "Leave no one behind". Last week I was visited the famine statues for a very special event held there every year. At that event, young women and men from the various projects in the north and south inner city of Dublin, including schoolchildren, give their testimonies on what poverty is like. Sometimes we sit here and talk about poverty but we do not know what it means to be poor. Listening to those young people is a humbling experience and it brings home what we need to address in budgets. I am aware that it has started but there is a need for further gender-proofing, poverty-proofing and equality-proofing so that we ensure of fair budgets from here on.

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