Cut the dole to cut higher tax rates

[TheBigShort]

What is fair or unfair is obviously subjective. I am much more interested in understanding what is effective.

Two contributors to this thread have stated that they have deliberately reduced their incomes because of the high marginal tax rate and the IDA has repeatedly warned that high marginal tax rates are being raised as a concern by prospective investors.

Whats your point? These two contributors, by virtue of their (apparent)*lower incomes and subsequent lower tax contribution are now being targeted by those propagating this topic to pay more taxes!

*I know from experience that most workers are resilient to wage cuts. Just my luck we have not one, but two, posters out of an audience of what? 20?, who voluntarily took wage cuts.

How about a concrete proposal then to redress the imbalances inflicted on the top 20% of earners?

 

[TheBigShort]

Sorry but what exactly are you suggesting that I fabricated?

.

Since you first made the accusation about me perhaps you could suggest exactly what it was I fabricated?

 

[Purple]

I asked for concrete proposals and I get this.

That's right. You asked for it and you got it. You, on the other hand, haven't answered any questions asked of you.

Can you actually offer one concrete proposal to apply that will be in line with the overall topic.
No more "if there is a tax reduction", or "bring everyone back into USC" without stating the applicable rate or the actual intent.
What do you propose to remedy this issue.

You have to understand that there's no silver bullet solution to the problem so a change in tax policy from now on is the best we can hope for. Therefore changing USC back to the way it was when it was introduced and changing tax rates and exemption back as well would be a good start. All future reductions should be done in a fair manner as I outlined above.

Universal Social Charge; a social charge which is universal. With so many people not having to pay it, it doesn't do what it says on the tin.

I am glad that you have now accepted that there is an issue and it needs to be remedied.

 

[Sarenco]

Since you first made the accusation about me perhaps you could suggest exactly what it was I fabricated?

The figures in post #102 - you just made them up!

 

[Purple]

The figures in post #102 - you just made them up!

Looks like it alright.

 

[Sarenco]

Whats your point?

That excessively high marginal tax rates are counter-productive in terms of raising revenue.

How about a concrete proposal then to redress the imbalances inflicted on the top 20% of earners?

Revert to broadly where our personal tax code was a few years ago.

 

[Gerry Canning]

Whoa folks !

Most postings (that I put up ) and indeed I think most put up , are generally musings , rather than fully factual.
Maybe I suffer from Attention Disorder but I get lost on counter and counter arguments.
Too many facts , don,t always make clarity.

I take AAM as a help to sort things , no more & no less.
Oft nuff I ain,t correct but if wrong, yousins sort me out. !!

 

[Purple]

Whoa folks !

Most postings (that I put up ) and indeed I think most put up , are generally musings , rather than fully factual.
Maybe I suffer from Attention Disorder but I get lost on counter and counter arguments.
Too many facts , don,t always make clarity.

I take AAM as a help to sort things , no more & no less.
Oft nuff I ain,t correct but if wrong, yousins sort me out. !!

All your apostrophes have died...

 

[TheBigShort]

The figures in post #102 - you just made them up!

The top 1% of earners have roughly half the share of income as the bottom 50% but pay more than 5 times as much tax. That looks like a good deal for the bottom 50% of earners to me.

These are your figures, that I used, I didn't make them up. I used my own figures, based on yours (e.g 20bn is half of 40bn) as examples to illustrate point.
The irony of being accused of fabrication in a topic that is built on pure fabrication has passed you by clearly.

 

[Purple]

These are your figures, that I used, I didn't make them up. I used my own figures, based on yours (e.g 20bn is half of 40bn) as examples to illustrate point.
The irony of being accused of fabrication in a topic that is built on pure fabrication has passed you by clearly.

OK, so you made up figures to illustrate a point but the point is meaningless unless you use real figures.

 

[Sarenco]

I used my own figures, based on yours (e.g 20bn is half of 40bn) as examples to illustrate point.

Indeed and your figures are pure fantasy - you've plucked them from thin air.

Do you accept my core point that excessive marginal tax rates are counterproductive?

 

[cremeegg]

We live in a world where some people earn €18,000 a year and others earn €180,000 a year.

This is an undesirable situation.

The progressive Irish tax system does more to level out post tax incomes that most other countries systems. Of course this is going to cause unhappiness among those who pay the most tax.

They ask why they should have to shoulder such a high portion of the cost of public services. Especially when they often don't even use the most expensive public services, they have private education and private healthcare.

Equally the low paid must feel something is wrong when they do a weeks work and earn a small fraction the amount others earn for their weeks work.

The solution lies not in fiddling with the tax system, but in developing an economy where there is more opportunity for well paid work.

Too many people leave education with no skills that might enable them to earn a living or contribute meaningfully to the economy.

 

[TheBigShort]

Just for the record.

Also I am not inherently opposed to minimum wage workers paying extra tax. I am opposed that such a tax may be used to offer tax cuts for higher earners.

There may be scope for cobtributions under USC,

I am being asked to produce real figures so as to disprove the proposition about high and low earners.

It has also been stated that USC be brought back to the way it was before - without any definitive reference or figures!

Nevertheless, I try to illustrate the point further approximate figures if I can be allowed such discretion?

The current USC is applied at 1% for incomes up to €12,012 with exemptions for income earners with less than €13,000.

So here is an opportunity for low paid workers to contribute more if there was no exemption, and like everybody else, pay 1% on that portion of the income.

Using revenue figures supplied by Bren Burgess in another thread, this will capture approximately 570,730 income earners below the €13,000 threshold.
Between all these earners they earn €3.38bn. So 1% applied on this equates to €33.8mn in extra revenue.
This will boost total income tax revenue from €20,478,000,000 to €20,511,800,000.

Before this adjustment the top 20% pay 75% of the income tax, according to the Indo article. That equates to €15,358,500,000. And as my adjustment has no direct bearing on their tax liability, that liability remains the same after the adjustment.
After the adjustment the top 20% are now liable for €15,358,500,000 of €20,511,800,000 or 74.87% of the total tax take.
Is this what this topic is all about? Will such an adjustment satisfy the top earners (even though it has made zero material difference to take home pay)?

If this is not sufficient, please put forward another concrete proposal.

 

[Firefly]

Reading through this thread, I am really thinking that a basic income and a flat rate of tax should be properly investigated by the government.

 

[T McGibney]

Just for the record.

The current USC is applied at 1% for incomes up to €12,012 with exemptions for income earners with less than €13,000.

So here is an opportunity for low paid workers to contribute more if there was no exemption, and like everybody else, pay 1% on that portion of the income.

Using revenue figures supplied by Bren Burgess in another thread, this will capture approximately 570,730 income earners below the €13,000 threshold.
Between all these earners they earn €3.38bn. So 1% applied on this equates to €33.8mn in extra revenue.
This will boost total income tax revenue from €20,478,000,000 to €20,511,800,000.

Before this adjustment the top 20% pay 75% of the income tax, according to the Indo article. That equates to €15,358,500,000. And as my adjustment has no direct bearing on their tax liability, that liability remains the same after the adjustment.
After the adjustment the top 20% are now liable for €15,358,500,000 of €20,511,800,000 or 74.87% of the total tax take.
Is this what this topic is all about? Will such an adjustment satisfy the top earners (even though it has made zero material difference to take home pay)?

If this is not sufficient, please put forward another concrete proposal.

You miss the very basic point that a 1% tax hike for 570,000 taxpayers is going to raise, in the scheme of things, a sum so puny that it couldn't be labelled as tax reform.

 

[Brendan Burgess]

We live in a world where some people earn €18,000 a year and others earn €180,000 a year.

This is an undesirable situation.
...

Why is it undesirable that a medical consultant after 10 years' training and 10 further years' experience should be paid 10 times more than someone who is collecting glasses in a pub?

I would have thought it was very desirable.

The solution lies not in fiddling with the tax system, but in developing an economy where there is more opportunity for well paid work.

It may be possible to increase the amount of well paid work, but there will always be a demand for unskilled, low paid work.

Brendan

 

[TheBigShort]

You miss the very basic point that a 1% tax hike for 570,000 taxpayers is going to raise, in the scheme of things, a sum so puny that it couldn't be labelled as tax reform.

I agree. So what im asking is for other concrete proposals.

 

[Duke of Marmalade]

I have to hand it to you biggie, you sure know how to spin out a thread. You seem to have all the great minds engaging with you almost single handedly You won't catch me engaging.

 

[TheBigShort]

Do you accept my core point that excessive marginal tax rates are counterproductive?

I already have accepted the point, why do keep repeating the question.
I don't agree that it applies to selective cohorts of income earners as outlined here. But yes, if marginal rates are excessive it is counterproductive.
20% paying 75% of tax does not identify the marginal rate applicable to those earners.
Nine drinkers in a pub earning varying degrees of income between €100-€1,000 tax free. A tenth worker earns €1,001. This extra euro is taxed at 10%- or 0.10c
Between them the tenth worker pays 100% of the tax. According to this thread such a disparity between the highest earners and lowest earners is completely unfair.
Or alternatively, it could be viewed as a fuss about nothing.

Perhaps you could provide at least one concrete proposal, with real figures, to redress the plight endured by the top 20%

 

[Fella]

I've been saying for ages the dole should be cut so well done for posting it in papers Brendan.

It's a barrier to work for some people. I know someone personally who lost a job , first thing they did was take kids out of Creche / after school that was a 300 or so savings. He was then offered a job at 500€ a week after tax and said its not worth his while with 230€ dole and 300 saved in child care, he still doesn't work and admits himself he's more money than ever and medical cards as well now.