Irish marchers protest against new property tax

DUBLIN Sat Mar 31, 2012 6:11pm BST

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DUBLIN (Reuters) - Some 5,000 people marched through the Irish capital on Saturday protesting against a new 100-euro household tax the government is struggling to collect - one of the first signs of resistance to Dublin's austerity drive.

Carrying anti-austerity placards, the crowd of trade unionists, opposition members of parliament and recession-weary homeowners from across the country marched to the national conference of senior coalition party Fine Gael, elected with a record majority just over a year ago.

They were supporting a call to boycott the tax, imposed as part of the latest austerity budget. Just over one-third of homeowners had paid the charge before the deadline on Saturday.

"It seems to me that the working-class people of this country are being asked to pay for everything," said 46-year-old electrician Brian Murray, whose Dublin home, bought for 455,000 euros ($605,900) in 2007 at the height of Ireland's property boom, is now worth just 170,000 euros.

"All the money seems to be going down a black hole to the bankers and the bondholders. They just appear to be fleecing us and I'm very angry about it," he added, his nine-year-old son marching at his side.

Though tens of thousands took to the streets when Ireland's financial crisis began to take its toll in 2009, the government has impressed investors by pushing through tax rises and spending cuts without significant social upheaval.

An agreement not to cut public sector pay or jobs has helped avoid public sector strikes similar to those in Italy, Spain and Portugal, and Ireland has never come close to the kind of riots that have rocked fellow bailout recipient Greece.

"AUSTERITY BITING"

But, with the Irish economy back in recession and the government only halfway through an unprecedented austerity drive that involves adhering to strict EU and IMF-imposed targets, a rise in popular resistance may worry foreign investors.

"I don't think you can compare it to riots in Greece or Spain, but it indicates that the austerity is biting and it is a small response from the public," said Theresa Reidy, a politics lecturer at University College Cork (UCC).

"There are some very difficult decisions coming down the road and this (the household tax) was a pretty small one, so it doesn't bode well for the government unless they can change how they are going to do this."

The boycott of the new charge, which is intended to bring in 16 percent of new taxes collected this year, must also so be seen in the context of a deeply held cultural resistance to property tax in Ireland, Reidy said.

Such taxes are common across Europe, but Ireland largely scrapped annual household charges in 1977 and all attempts to revive them have met popular protests.

The current flat rate charge of 100 euros - less than two thirds the cost of a television licence - is due to be replaced by a progressive property tax next year that will force some households to pay more than 10 times that amount.

Finance Minister Michael Noonan, whose Fine Gael party is by far the most popular in the country, said he was confident that most of the country would continue to back the government.

"Not everybody thinks it's fair but mainstream Ireland will stay with the government as long as they think what we're doing is fair," Noonan told his party's national conference.

Noonan also told the conference that countries keen on investing in Ireland and aiding its economic recovery would quickly lose interest if Irish voters rejected Europe's new fiscal treaty in an upcoming referendum.

Ireland will hold what will probably be the only popular vote over German-led plans for stricter budget discipline on May 31.

(Reporting by Padraic Halpin; Editing by Tim Pearce)

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