Sir, – A tendency I rather dislike in government is to see taxation as the solution to all problems. With regard to environmental matters, it’s also ultimately self-defeating as, once people begin to comply with the desired behaviours, previously stable tax revenue declines. Then those measures must be reconsidered. This is already the case with electric cars, for example, as declining tax revenue from diesel will need to be replaced somehow.
In attempting to describe how taxation in Ireland might address broader environmental concerns, Justine McCarthy outlines the varying VAT levels on different categories of goods (“To sustain the world we need to reset our economic mindset (July 28)”, Opinion & Analysis, July 28th).
She argues that higher levels imposed on luxury goods might reduce their adverse environmental impact, referring to designer handbags, private jets, leisure sea craft and so on.
I am very sceptical of any likely environmental benefit to such an approach. The prestige brand designer handbags are more likely to come from Milan and Paris than sweatshops on the other side of the world. The distance that fruit in the supermarket has travelled is often impossible to reconcile with its cheap price, and a bunch of bananas will weigh more (requiring more transport fuel) than most designer handbags. And most of the items listed are really desired simply because they are so expensive. As snob goods or Veblen goods, the statement they make of wealth is a large part of the motivation to buy them. Thus an increase in price can simply add to their popularity.
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Meanwhile, it is hard to think of goods more easily kept offshore, or in other jurisdictions, than private jets or super yachts.
Ireland being “teensy weensy” as the article states, our ability to alter behaviour constructively in this area must be minimal and such efforts might make it worse.
Yours etc,
BRIAN O’BRIEN,
Kinsale,
Co Cork.
Sir, – Justine McCarthy advocates increasing VAT rates on environmentally damaging activities. This may be a good idea, and her first example is a good one: it does not seem reasonable to charge the same VAT rate on a bag of wildflower seeds as on a bag of peat moss. Sowing wildflower seeds is probably beneficial while we may have dug up too much of too many of our bogs. However, it is much less clear that people who do not own a car, but rent one from time to time to do jobs that cannot be done with a bicycle, are harmful to the environment. – Yours, etc,
NIALL O’BRIEN,
Dublin 4.
Sir, – Justine McCarthy’s excellent article fills me with both hope, that there is so much we could be doing, and despair, that it is not being done. Every one of her practical suggestions for how to use the VAT system to incentivise climate friendly purchases could be very easily implemented, and there are hundreds more examples she could have given: lower VAT on Irish-grown than on imported foods, lower VAT on building materials that are environmentally friendly, higher VAT on products that come wrapped in plastic. Most people would like to do the right thing, but they won’t if it is more expensive, less convenient and less readily available than the alternative. For years I drove my car to work until a new one-way system and cycle lanes made it even more stressful that it was already, so I moaned and groaned for a while, and eventually started cycling, and soon realised that I should have done it years ago! People can and do change their habits, but they need an incentive, and, as the plastic bag levy and the smoking ban show, they will often look back and realise it really wasn’t that much of a sacrifice and was well worth it. I will give my vote to any politician who is brave enough to take bold action, and stand their ground against the inevitable backlash from vested interests. Sometimes we have to be forced into change, and that’s what leaders are for. – Yours, etc,
AISLING JUDGE,
Ballinteer,
Dublin 16.