Oxfam Ireland's Recommendations for Budget 2023

Oxfam Ireland's Recommendations for Budget 2023

Irish wealth tax and broad windfall tax could yield billions per year, enough to help address cost of living crisis and keep overseas aid commitments

Oxfam Ireland calls for Budget 2023 to tackle poverty and rising inequality in Ireland and across the world

The introduction of an Irish wealth tax as well as a broad-based windfall tax across all industries generating extreme excess profits, not just the energy sector, could generate billions in new revenue, says Oxfam Ireland. An Irish wealth tax alone at low rates of 1.5% and 2% on levels of net-wealth greater than €5 million and €50 million respectively could yield €5 billion per year. Oxfam Ireland’s proposal for a broad-based windfall tax beyond the energy sector has been recommended by the IMF to help build social solidarity and address inequality. This revenue could cover vital budget contributions in Ireland to help address the cost-of-living crisis nationally as well as meeting life-saving commitments globally on Official Development Assistance (ODA) and climate finance.  

In their Pre-budget Submission, published today (01.09.22), Oxfam Ireland called on the Irish Government to deliver a Budget 2023 that addresses both national and global issues, including by tackling rising inequality. 

Speaking on the submission’s launch, Chief Executive Jim Clarken said: “As Ireland continues to address the economic fallout of COVID-19 as well as the ongoing impact of the climate crisis and the conflict in Ukraine at home and across Europe, it has never been more imperative to think and act like global citizens and deliver a budget that demonstrates this kind of solidarity.

“Two years on from the beginning of a global pandemic and in the middle of a global food and cost of living crisis, people are facing impossible situations, at home and across the world. These crises are not one-off events, nor are they outside of our control – they are driven by global inequality which is rising in every way, including across wealth, income, gender and race. 

“Our call for a wealth tax and a broad windfall tax could tackle the extreme rise in inequality we’ve witnessed over the last two years – where billionaire wealth soared and food and energy companies’ profits skyrocketed while decades of progress on ending extreme poverty were reversed and millions of people face hunger and destitution.”

Oxfam is also calling on the Irish Government to effectively tackle the climate crisis by addressing extreme carbon inequality where the top 10% of the Irish population by income levels emit nearly as much as the bottom 50%. The development organisation is urging the Irish Government to implement measures targeting excessive and luxury emissions and ending subsidies for high emitting sectors, enabling those who contribute most to climate change to take responsibility for addressing the issue. 

Clarken continued: “Budget 2023 is an opportunity to create a fairer, more sustainable and human economy – one that recognises the significant threat our planet is facing and the deadly impact this is already having on the world’s poorest and most vulnerable.

“Right now, one third of Pakistan – a country that contributes less than 1 percent of global greenhouse gas emissions – is under water. While across drought-ravaged Ethiopia, Kenya and Somalia, 22 million people are facing crisis levels of hunger. The collective carbon emissions of these three countries are 0.1 percent of the global total.

“It’s clear that we’re long past the time for talking and instead need to take radical action. This includes introducing policy measures that target excessive and luxury emissions, for example private jets. It’s preposterous that the super-rich continue to prioritise convenience and indulgence over investment in righting the wrong they’ve most contributed to.

“As well as working to reduce carbon emissions at home, Budget 2023 needs to see an increase in both the quantity and quality of climate finance to those countries hit hardest by extreme weather and disasters.”

Among Oxfam Ireland’s pre-budget asks, the following are priority in addressing global poverty and inequality:

  • Increase Ireland’s ODA budget in Budget 2023 by €233m and set us on a path to reach the target of 0.7% of Gross National Income spent on ODA by 2030.
  • Support immediate cancellation of 2022 and 2023 debt and interest payments for all low and middle-income countries so that they can recover from the deadly threat of Covid-19, climate and conflict. 
  • Introduce a Wealth Tax and Windfall Tax to fund measures to help address inequality and poverty in Ireland and globally
  • Ensure climate action addresses extreme carbon inequality by targeting excessive and luxury emissions, ending subsidies for high emitting sectors and implementing a comprehensive just transition process. 
  • Increase Ireland’s climate finance contribution to ensure that Ireland is contributing its fair share, which we estimate would be between €340m to €840m per year taking past emissions and wealth into account.
  • Increase resources and personnel to the Irish Refugee Protection Programme to ensure that Ireland meets its resettlement pledges, especially given the number of conflicts and crises worldwide forcing millions to flee. 

Download the full pre-budget submission here.

ENDS

CONTACT: Alice Dawson Lyons | alice.dawsonlyons@oxfam.org | +353 (0) 83 198 1869

Notes to the Editor:

  • Download Oxfam Ireland’s full pre-budget submission here.
  • Oxfam Ireland is proposing that a windfall tax be levied on extreme excess profits in large companies. Regulators should be tasked with imposing fines or other relevant measures to prevent windfall taxes being passed on to consumers, as is the case with the Spanish and Italian model of windfall taxes. In 2021 the IMF supported broad based windfall taxes on excess profits to help build social solidarity and tackle inequality- see here and here.
  • Details of Oxfam Ireland’s Wealth Tax proposal can be found in their submission to the Commission on Taxation and Welfare.

 

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