Big business adds to homes crisis, so make it stump up

It worked in San Francisco so perhaps we should copy the idea of getting hi-tech companies to help us out, writes Willie Kealy

NOBODY likes paying tax. And we can all make a case that those we elect will only waste the money.

The disgraceful over-run in costing the planned children’s hospital makes that case powerfully.

Except... they are the people we elect. And it is a great privilege to be able to elect them, and, if we are dissatisfied, to un-elect them.

So really we should see paying tax in a democracy as a privilege. Of course, for most of us, it isn’t a choice. For the wealthy, there are legal loopholes and sharp accountants to minimise their liabilities.

And good luck to them, so long as they are working legitimately within the system.

Then there are the tax exiles. We have had exiles from this country for decades, centuries even.

And most of them would have been more than pleased to pay their taxes if they could have stayed at home. But they did not have that choice, and it is an insult to those genuinely forced to emigrate, to attach the name “exile” to those who choose to live abroad rather than contribute to the running of this State.

They should in fact be called tax tourists, because we allow them to swan in and out of the country almost at will, applying to them only the mildest of residency restrictions.

It is not too harsh to say that along with obvious greed, they show a lack of patriotism by their actions, which is not balanced out by generous donations to charitable organisations. They want it every way. They don’t want to abide by the terms and conditions of being an Irish citizen, but they would like the rest of us to ignore that, pick up their slack, and think well of them anyway.

Those who are based here and work within the system are not just captains of Irish industry. We have to include also the giant multi-national hi-tech companies which bring so many jobs, for which we are extremely grateful, but seem to pay relatively small amounts of tax.

We have been accused of being a tax haven as a result, and even when EU Competitions Commissioner Margrethe Vestager tells us we are owed huge sums by these companies, we are reluctant to collect it.

In fact we are litigating against our right to seek payment of this money.

As well as being accused of underpaying taxes in Ireland, the big multinationals are also being held liable in part for the plight of the homeless but especially for the housing crisis. In a nutshell, they are employing large numbers of young people at reasonably good salaries.

And they all have to live somewhere, preferably somewhere near to their place of employment. Their accommodation needs raise the prices of scarce housing stock — €4,000 a month for a cottage in Dublin’s Ringsend, for example, according to Fr Peter McVerry last week.

This, together with the relatively slow building growth rate of 5pc per annum, and the interest shown by large institutional investors in buying up newly built apartment blocks, makes it difficult to compete in the purchase or rental markets.

It might seem crazy to attack those who create lots of good jobs. But in San Francisco in California, home of Silicone Valley, that is just what they have done, and nobody thinks they are communists, except maybe Donald Trump.

The voters of San Francisco passed Proposition C, to tax any company with gross annual receipts of more than $50m, for the specific purpose of helping alleviate the housing crisis, which the city fathers and mothers say owes much of its origins to the presence of these companies.

When Prop C was first mooted, the commercial giants, like Facebook and Google and Twitter and the $22.5bn-Stripe company, owned by the Collison brothers, John and Patrick from Limerick, responded by volunteering the expenditure of vast amounts of money to create housing.

Partly this was because they recognised the need for their own employees to be secure in their housing.

And Facebook pays substantial bonuses to workers who live near their place of employment. Partly the companies hoped that they could demonstrate that their philanthropic efforts made Prop 50 unnecessary. But they failed.

Would such as approach be welcomed here, and, in the absence of any specific extra tax threat similar to what they faced in San Francisco, would the hi-tech companies be willing to consider doing that in Ireland?

There will always be some ideologues willing to attack these benefactors of Irish jobs, but otherwise it would not seem like a good idea for the Government, for example, to take them on. And given their attitude to the money the EU Commission says we are owed already, it seems unlikely there would be any such appetite anyway.

There is no doubt that the housing crisis is one that can be largely alleviated with money. There are not enough social houses.

Local councils do not have the money (or the will) to build and manage them, and the Government does not have the funds or the willingness to back the councils anyway.

Maybe it would be a good thing if companies like Facebook decided they had an obligation or maybe just a desire to get into the housing market here, if only to relieve some of the pressures on their own employees.

There could be downsides. We have had few examples of paternalistic employers here in the past, but those few we did have — the Guinness and Bewley families, for example — proved to be of benefit to all associated with them. But what we don’t want to see is something akin to the old 19th-century “company town/company store” model, where every aspect of the life of the employee becomes almost totally dependant on the employer.

At the end of the day, we live in a functioning democracy. And it would seem best that everyone pay all the tax they are liable for, and the elected government then works efficiently to iron out the problems of the day — including the housing crisis.

And if on top of that, our multinationals are willing to lend a hand, too, that should be welcomed.

‘No doubt the housing crisis can largely be alleviated with money’