INDEPENDENT TD Mick Wallace has pledged to devote half of his Dáil salary to meeting his construction company’s settlement with the Revenue Commissioners.
In a statement to the Dáil yesterday evening, Wallace said he regretted the “error of judgement” in not disclosing M and J Wallace Ltd’s full VAT liability to the Revenue Commissioners for 2008.
But how long will it take for Wallace to repay the full amount? We’ve dug out a quick Excel spreadsheet to try and work it out – and the answer isn’t an encouraging one for the 56-year-old TD.
First of all, we should mention the ground rules: we’re making the hypothetical assumption that Wallace will remain a TD for the rest of his life.
We’re also assuming that he isn’t including any of his parliamentary allowances in his calculations – as those payments are paid under strict terms and conditions, which would not allow for the cash to be deployed for personal reasons.
Therefore, we’re not including the €27,000 in unvouched travel expenses that Wallace is entitled to claim from his Dublin address (which he uses for parliamentary duty), nor the €41,152 in the unvouched ‘leader’s allowance’ that independents are entitled to (but which Mick does not claim).
The one thing we’re not sure of is whether Mick intends to devote half of his gross salary, of €92,672, or his net salary after he pays income tax and the Universal Social Charge. It’s possible that Wallace will intend to devote half of his gross wage, leaving himself with less than half of what’s left after taxes.
Therefore we’ve done two corrections – one with each, using TaxCalc.ie’s online calculator to estimate that Wallace’s after-tax salary is €55,615.
M and J Wallace Ltd’s full settlement – as listed in the Iris Oifigiúil on Tuesday – is €2,133,708. TDs are paid on a monthly basis, at the end of each month – so we’re assuming that Wallace’s pledge will begin to take effect in a fortnight’s time.
If we take half of Wallace’s gross salary, it’ll take 553 months (at €3,861.33) – that’s 46 years and one month – to pay the full €2.13 million settlement. By then, June 2058, Wallace would be 102 years old.
It’s even more grim for the TD if we deal with half of his net salary, which works out at around €2,317.29 per month. It would then take a whopping 921 months – that’s 76 years and 9 months – to pay off the full debt, bringing him up to February 2089, when he would be 133.
This is also predicated on the assumption that the Revenue liability does not accrue interest in the meantime. So, if M and J Wallace Ltd does not successfully emerge from receivership and begin to trade successfully again, its proprietor will be spending a long time paying back its debts.
Coupled with the €19.1 million judgment secured by ACC Bank against both Wallace and the company last year, it’s more likely that bankruptcy proceedings will eventually be taken – a move which would disqualify Mick from membership of the Dáil.
To embed this post, copy the code below on your site
have your say