Socialist Party statement on Mick Wallace tax controversy


Wallace must take obligation to repay tax debt seriously

The non payment by Mick Wallace’s of €1.4 million VAT due on sales of apartments is disgraceful. When speaking on Morning Ireland after the story broke, his comments that the €2.1 million due to Revenue (including interest and penalties), would not be paid, itself indicated the gulf in his views on what is acceptable on these issues and those of ordinary working class people throughout the country and in his own Wexford constituency.

On Thursday 14 June Mick Wallace made a personal statement in the Dail. As part of that he stated that he will seek to come to an arrangement whereby half of his Dail salary would be used to help pay the outstanding bill with Revenue.

As the Socialist Party advocated in last year’s general election that all TDs should be paid wages equivalent to ordinary workers, Mick Wallace’s suggestion wasn’t really very significant as far as we are concerned. He should take seriously his responsibility to repay all the money outstanding.

All of Mick Wallace’s assets, ones he owns or co-owns, should now be factored into any payment deal. There should be changes to the limited liability laws which currently allow businesses to renege on paying monies they owe. If there are other assets where he is the beneficial owner, not the legal owner, but the real owner and beneficiary these should also be factored in.

The media, who tried to say that the Socialist Party didn’t condemn Mick Wallace enough, exposed the hollowness of its position when they refused to accept these proposals put forward by Joe Higgins in relation to the Mick Wallace’s finances and the need for all monies owed to be paid.

Evidentially the “outraged” media wasn’t so outraged at what Mick Wallace did, for it to support real measures that would impinge on the wealth of the rich and use it for the public good; the media’s agenda is clearly different.

The Socialist Party does not support or defend Mick Wallace’s actions in any way. He may not be one of the very big developers, who along with the bankers and politicians, constituted the “Golden Circle” and who stoked up the property bubble. However, he is a boss and a developer and he did profit significantly from the property bubble and from the hard work of his employees.

The Socialist Party did not support Mick Wallace but neither did we go along with the orchestrated calls in the media for his immediate resignation as a TD. We did not support that chorus for two reasons.

It is clear that sections of the media wanted to use the Mick Wallace situation to try to legitimise an approach where they can create an irresistible pressure through intimidation and exaggeration to force political resignations. They want to build up their ability to intervene into events in order to prop up a weak capitalist establishment and try to stamp on anyone or any force that fights back against austerity.

They also wanted to specifically link Wallace’s wrong doing with the Left, even though there is no such political link, in an attempt to damage the credibility and the potential for the Left – both to lead struggles against austerity, like in the Household Tax, and build a mass political alternative.

We completely opposed Mick Wallace actions but we were also correct not to assist the rightwing media in forcing him out, because to do so would have helped the media increase its power. They tried to play the same role regarding David Norris in the Presidential Election and undoubtedly they are gearing up to try to undermine the credentials of left / socialist groups and ordinary activists who will fight back in the months ahead in the Household Tax battle.

Secondly, if the media was successful in its goal of forcing Mick Wallace’s resignation within days of the disclosure of non-payment that would have constituted the quashing of the democratic decision and rights of a substantial number of ordinary people in Wexford, who voted for him without any regard to how those people felt about the situation.

Instead the Socialist Party gives weight to the wishes and views of the 17% of voters, (over 13,000 people), who voted for Mick Wallace last February. Mick Wallace’s future should be determined by those who voted for him as opposed to being dictated by the unelected and biased media.

Independent Newspapers has been central in the campaign to force Wallace’s resignation and in attacking the Left on this issue. But their hypocrisy on this is breathtaking. The two biggest shareholders of the Independent Group are non resident for tax purposes and maximises their profits through blatant tax avoidance at the expense of ordinary people.

The claim that the Socialist Party is hypocritical because if this situation had involved a Fianna Failer or a Fine Gaeler, we would supposedly have demanded their head is simply wrong. As everyone knows there has been much wrong doing in political circles over recent years, yet it has never been the position of the Socialist Party to rush to demand the resignation of TDs.

Politically the Socialist Party focuses on the policies that the system imposes as the causes of the problems facing working class people, not the individuals or personalities that are imposing them.

Resignations don’t usually represent a way forward or offer a major opportunity to fight back. Real change can only be achieved on the basis of mass struggle and the political reorganisation of the working class. These are the points that we emphasise.

Notwithstanding the huge propaganda campaign, we believed that many working class people and particularly those people who voted for Mick Wallace in Wexford, while opposing what he did, also see the media’s agenda and would oppose the chorus for resignation. This view has been confirmed by local polls in Wexford, where very large numbers have opposed the calls for Wallace to resign.

People in Wexford and generally will be disappointed by what Mick Wallace did and at how he has responded to this controversy. The people who were voting for Mick Wallace’s believed they were voting for change and since then he reflected the opposition in the community to austerity by the position he took in actively opposing  cuts to services and by coming out in opposition to the Household Tax. Unfortunately through his actions Mick Wallace has given the media and the establishment an opportunity to attack those campaigns.

Notwithstanding that we will do all in our power to fight austerity and in particular to defend and build the Campaign Against Household and Water Taxes (CAHWT) and prepare for the decisive battle that is likely to unfold this Autumn.

Mass struggle and connected to that, the building of a new party made up of the working class and young people which fights for a socialist alternative, is the way to really challenge the capitalist establishment. Regardless of the rotten role of the media, working class people, if organised and armed with socialist policies have the power and capability to run the country.



Socialist Party statement on Mick Wallace tax controversy

Mick Wallace’s failure to pay the original sum of €1.4 million in VAT is disgraceful, unacceptable and indefensible.

Mick Wallace was elected to the Dail in the general election in Wexford with 13,329 votes, the highest personal vote in that constituency since 1945. Undoubtedly it was because many ordinary people perceived him to stand for something completely different to the political establishment because of his previous opposition to the invasion of Iraq and opposition to the bailout of bondholders and austerity at their expense. This revelation will have disappointed many people who saw him in this light. Mick Wallace has also given the media and the establishment an opportunity to attack, and to try to undermine, the political campaigns that he has been associated with such as the Campaign Against the Household and Water Taxes.

The role of the right-wing media
The Socialist Party has called on Mick Wallace TD to pay back every cent that is owed. These unpaid taxes should be repaid from whatever resources Mick Wallace has at his disposal, including his Dail salary.

However the Socialist Party has not joined the frenzied chorus in the media demanding Wallace’s immediate resignation. In taking this position we believe we are reflecting the view of many ordinary people in Wexford and of those who voted for him, who condemn what he did but who don’t believe it means he shouldn’t be a TD to represent their area.

Since the revelation of Wallace’s failure to pay the VAT sections of the media and some representatives of right wing political parties have been demanding that he resign forthwith from the Dail. Mick Wallace’s action is completely unacceptable but the media and these politicians have shown no respect for the democratic wishes of those who elected him.

The media are not impartial observers. A substantial part of the media is owned by billionaires and millionaires who have a vested interested in pushing a right wing political agenda. No doubt Wallace provoked their ire when he opposed the bondholder bailout and opposed extra austerity measures such as the home tax and campaigned against the Austerity Treaty in the recent Referendum.

Independent News and Media is owned by two tax exiles – tax dodgers – one of whom has become a billionaire as a result of obtaining the second mobile telephone licence in this State courtesy of major inside information received from a Fine Gael Minister to whom he paid large amounts of cash as the Moriarty Tribunal revealed. Independent New and Media and the majority of the media support the establishment parties and defend the capitalist market and the current anti-working class austerity agenda.

The media are forthright in pursuing a right wing political agenda and have attempted to intervene and distort the democratic process and undermine those it believes threaten the establishment, as was seen in the presidential election and the recent referendum. The Socialist Party believes that it is crucial to stand up against the media’s attempt to pretend to stand for accountability and democracy in determining who should be in the national parliament while in reality it is trying to railroad its pro capitalist agenda.

The media should not have the power to determine who is a public representative or be allowed to drive people from office by riding roughshod over the democratic rights of the electorate. The people of Wexford should pass judgement on Mick Wallace through the ballot box at the next available opportunity they have to vote.

Hypocrisy of the establishment
The Socialist Party was the first to demand that Mick Wallace should pay whatever taxes he owes. There can be no “Chinese wall” between the debt that is owed by Wallace’s companies and his own personal assets. Mick Wallace, (or any other developer, or big business person) should not be allowed to use company law to avoid meeting his tax obligations. PAYE workers cannot avoid paying their taxes. For too long in this country millionaire developers and big business have been able to use laws, designed to protect their wealth, to avoid paying their taxes and their debts.

When Joe Higgins TD, raised these points on the Pat Kenny Show (RTE Radio One), Pat Kenny demurred on the basis that limited liability was to prevent a situation where related companies to a bankrupt one could be closed down with job losses. But current laws do not take into account what profits, resources and assets such companies might have.

There is massive hypocrisy among the political establishment on taxation issues. In 1993, The Fianna Fail /  Labour government brought in a tax amnesty for the super rich, which it is thought outright gangsters and criminals were also able to avail of. When Joe Higgins won a seat in the Dail in 1997 he often demanded that the cloak of secrecy around this tax amnesty be removed and its secrets revealed. Needless to say that did not happen. In 1999 Fine Gael paid £111,110 (punts) to the Revenue Commissioners in 1999 for PAYE and PRSI, which it had not paid, and penalties for paying staff under the counter for nine years previously.

United Left Alliance bear no responsibility for the actions of other TDs

Many ordinary people view what is happening in the millionaire owned media as imbalanced and can see that they have an agenda. This is not about making big business or the rich who avoid paying their taxes accountable – this is an opportunity for the media and sections of the political establishment to try to link Mick Wallace to the left and to use his tax issues, in a dishonest way, as a weapon to try to discredit the left.

There has been a conscious attempt by the media and some right wing politicians to politically connect the independent TD and property developer, Mick Wallace, to the Socialist Party and the United Left Alliance. In doing so the billionaire owned media are attempting to damage the ULA and the Socialist Party. Mick Wallace has actively supported campaigns such as the Special Needs Assistants and Parents group fighting against the reduction in SNAs and the Campaign Against the Household and Water Taxes. Some other independent TDs have done likewise. This does not make the Socialist Party or the ULA politically responsible in anyway for them or Mick Wallace.

Attempts have also been made to distort the nature of the Dail Technical Group, with an attempt to portray it as a political party or an alliance. This is totally false. The Technical Group is the arrangement under the Dail Standing Orders by which independent deputies and small parties with less than seven deputies secure speaking rights and can put priority questions to government Ministers. It is purely a technical arrangement and therefore the Socialist Party and the United Left alliance bear no responsibility for the actions of any independent deputies any more than they do for members of all the other parties in the Dail.

Media will not distract from the fight against austerity
he right wing media are attempting to damage the Socialist Party and the ULA because of the potential that exists for the left to grow in the next period, which is shown by the very successful campaign against the household tax and the 40% no vote in the referendum. The Socialist Party and the ULA can make significant gains at the next general and local elections and this will represent a real threat to the pro-austerity parties and their cheerleaders in the media. There is no doubt they also wish to weaken some of the independent TDs who opposed the austerity agenda, spoke out against it and campaigned against it in the referendum campaign.

The Socialist Party will not be deflected from waging a struggle against austerity. The government is fine-tuning its plans to issue threatening letters to the majority of householders who have refused to pay the Household Tax. These letters will be disgracefully followed up by dragging decent ordinary people before the courts – when not one developer, banker or business person has been held accountable for the economic disaster that they inflicted on this country. The government plans to impose another €8.6 billion in austerity measures, as well as water and property taxes. These are the issues that the Socialist Party is focused on, building mass movements and resistance against the governments attacks in order to defend the interests of the majority of people, not the profits of the rich.

The Socialist Party has not joined in with the media chorus calling for Mick Wallace to resign, we believe that to do so would set a dangerous precedent and give credence to the idea that the media and sections of the establishment should have the power and the right to overturn the democratic decisions made by the people. The Socialist Party completely opposes what Mick Wallace did and unlike the vast majority of the media and the right wing politicians who are calling for his head, we are demanding that he pay the €2.1 million taxes that are owed from whatever resources he has at his disposal.


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