Even the giant leprechaun dressed in a heavy bottle-green coat and a woolly detachable head near a Dublin landmark seemed to be enjoying the sunshine. When he took off his head there wasn't a single sign of perspiration on his face. He appeared happy enough to take a breather and let his companion pass the collection hat around the knots of tourists using their iPhones and mobiles to take a snap beside the Molly Malone statue across the road from the walls of Trinity College.

When he put the ginger-bearded head back on, the leprechaun was asked whether the unseasonably warm weather was making his suit uncomfortable. Faithful to the leprechaun omerta, he gave a non-verbal response: a shake of the head to indicate he wasn't sweltering, and a thumbs-up presumably to show he was happy to see the crowds come out in the sun.

With throngs of shoppers darting in and out of stores on Grafton Street and drinkers slaking their thirsts outside the pubs on side streets all the way up to St Stephen's Green, you could be forgiven for wondering, momentarily at least: recession, what recession?

The government faces a test this week over the €100 (£83) flat-rate household charge that every homeowner must pay by the weekend. Failure to pay could result in heavy fines, but only about 30% have done so thus far. The government fears that failure to collect the revenue needed to pay for local government services (the Republic abolished UK-style rates in 1977) would send out a damaging signal that the Irish won't pay their way.

The household charge could be the greatest error of the Fine Gael-Labour coalition's first year in office, and has already been compared (with a more than touch of hyperbole) to Margaret Thatcher's poll tax. There will be no replication of the poll tax riots in Dublin, but if less than half the population signs up by the end of the week it will mark the first act of collective defiance against the austerity programme designed to drive down the national debt and restore international confidence in the economy.

Fine Gael and Labour are starting to realise they have a fight on their hands as they face accusations that they are more interested in penalising mortgage-holders than the bankers and speculators whose greed laid waste to the property market. On Monday the Fine Gael minister of state for finance, Brian Hayes, said that if the government didn't get the revenue from the household charge it would have to find the money from elsewhere, possibly by raising personal taxation.

"Pretending that there is some painless solution to this is utterly delusional," Hayes said. "If we don't want to see jobs being lost because of a taxation system that taxes the hell out of people for working, then the only way to resolve our problem is to look at new sources of taxation." He said the state still needed to borrow €10bn this year to pay for public jobs and services.

Opposition parties, most notably Sinn Féin and the United Left Alliance, are capitalising on the opposition to the charge, although the two blocs have taken different approaches. Sinn Féin TDs who are homeowners will refuse on principle to pay the €100 tax, but the party has stopped short of calling on the public not to pay either, because it says it would not be in a position to pay everyone's fines and legal bills. The ULA, comprising the Socialist party and People Before Profit TDs, has urged all those liable for the tax to refuse payment before the weekend deadline.

The controversy could pose a threat not only for Enda Kenny's administration but for the EU as a whole. If the issue is not resolved by the time Ireland goes to the polls to ratify the EU fiscal compact, voters might be tempted to use the referendum to protest against the tax. In their anger over a domestic issue, the electorate could throw the EU reform process back into chaos.

Inside the student cafe of Independent College on Dawson Street, the cafe's owner, Jonathan, proffers the view that if the weather was like this more of the time, the Irish would not be so weighed down by all the economic doom and gloom.

"Even if you were out of work or skint you could sit out somewhere in a park for instance and at least it would be free. It's much easier to do nothing in the sunshine, whereas you have to go somewhere which can cost if its raining," he joked beneath a Cuban national flag and a stencilled outline of the face of Che Guevara displayed in the café along with the Irish tricolour.

According to Jonathan's theory, a long spell of sunshine would make Ireland a nation of lazy, sleepy, hedonistic Sancho Panzas rather than a rising mass of raging rebellious Ches. We would be too busy baking under the sun to care about direct action. But Irish radicals should not be too despondent, even if the masses seem more interested at present in sunscreen than socialism. Greece is sun-kissed for most of the year, and yet those long periods of blue skies have failed to stop the Greeks from revolting.