Indo - "Almost one in four Irish earners is paying no income tax, says Revenue"

It might. And note that for the majority of Swedish taxpayers the combined marginal rate of income tax and social security tax is just under 64%, so clearly this model is compatible with very high marginal rates of tax.
Yes, they have a less progressive taxation system where low and middle earners are taxed far more heavily.
They also have a very heavily subsidised childcare system so the financial disincentive to work due to childcare cost is (almost) removed.
Between the less progressive income tax system and the subsidised childcare system, and a less generous welfare system, there is no financial cliff-edge for working parents when childcare costs come along.
 
I'd also reduce FIS and other welfare rates. Nobody of working age should be better off (or as well off) not working.

What working-age welfare rates would you reduce?

Social insurance rates or social assistance rates?

Social insurance

JSB
Illness Benefit
Maternity/paternity benefit
Carers benefit
Invalidy pension



Social assistance (means-tested)

JSA
DA
One Parent Family payment
Carers Allowance



 
All of them.
I'd make it much harder to get invalidity pensions or illness benefit. The numbers receiving those are crazy. If the answer to the question "could you work at all if your life depended on it?" is "Yes" then you should be working.

I'd have a sliding scale for long term social insurance, tying the starting rate to your income prior to unemployment and reducing it to a means tested benefit after 3 years. Means testing would involve selling off your assets to support yourself prior to receiving additional payments.

All carers payments should be means tested. One parent family payments should not increase for additional children.

I'd also reduce HAP by a significant amount as it just distorts the market. People who work should be able to access housing before people who don't work. It's crazy that people on welfare end up with better housing than people who aren't. It's crazy that people who work in well paid jobs can't afford to have children and people who are reliant on welfare can't afford not to have children.

Nobody on welfare should be as well off as anyone who is working full time. Welfare for those of reasonably sound mind and body should be temporary.
 
We are massively generous on pensions.
It’s more subtle than that.

In Ireland contributions are exempt, capital gains are exempt, and drawdowns are taxed. This is known as an EET system and is global best practice.

What Ireland has though is a very progressive tax regime for personal income. This makes it attractive to contribute as you get relief at 41% but you will be drawing down some or all of your pension taxed at 20%.

I wouldn’t adjust the pension tax regime. I would make the personal tax system more progressive.
 

You will be happy to hear that JSB stops after 9 months of unemployment.

After that, the claimant may apply for means-tested JSA.


Also, Illness Benefits lasts for a max two years.
 
That's odd, the VAT on most tradesmen's services is 13.5%.
You've caught me forgetting the details there. Got quoted a price for a new kitchen in the showroom. Went ahead with it. When they were finishing up, I get a call at work from my wife who was at home on maternity leave saying the foreman is telling her the price quoted is the cash price and she needs to go to the bank to avoid paying more for VAT.
 
You are just looking at the earnings figures before welfare transfers and concluding that welfare payments level the playing field, full stop no need to look any further. However you have completely ignored my main arguments ,the disincentives to work by all these government interventions. If so many people are disincentivised to work or work alot less by our welfare and taxation system the productivity of the domestic economy goes down and the prices of everything goes up. This is borne out by what is happening on the ground. Now the cso might produce statistics about the high "productivity " of Irish work force but again that figure is grossly distorted by the multinational transfers to Ireland from rest of world. In effect Ireland gets the benefit for alot of tye productivity of the global multinationals
 
If the 53k properties were available in the private market it would reduce the impact on rents remember supply v demand in economics. They are not because they are fulfilling a social service ie housing those who can't house themselves.

People purchasing a property to live in do not see it as financial investment they see it as having stability to start a family etc. I wonder how many of those who purchased a property to live in during the boom would agree with you in 2011/2012.

People could equally choose not to accept responsibility for housing themselves and just rely on the State.

Those who avail of the "generous tax breaks" will end up paying it back via higher income tax when drawing down their pension by ending up in the higher tax bracket.
 
If so many people are disincentivised to work or work alot less by our welfare and taxation system the productivity of the domestic economy goes down and the prices of everything goes up. This is borne out by what is happening on the ground.

That may or may not be so. It is a plausible hypothesis - no more or less. It is not "borne out" by what is happening on the ground - it may correlate to "what is happening on the ground" - but so may lots of other variables.


There is no doubt that Ireland's overall high productivity figures are driven by the multinational sector. Some of this relates to distortions from transfers to Ireland from elsewhere. But even after excluding these transfers the productivity of the multinational sector is very high. There is surely something to be learnt from this. On the other hand I am not sure how they compare "productivity" in this sector to say homecare services, nursing homes or early childhood services.
 
Those who avail of the "generous tax breaks" will end up paying it back via higher income tax when drawing down their pension by ending up in the higher tax bracket.

How is this a true statement? Even those with the largest funds can drawdown €500k, pay 12% tax on that. Effective tax on a pension fund is far below the marginal rate not even considering tax free growth and potential for some of the fund to fall under the CAT threshold on death.
 
Those who avail of the "generous tax breaks" will end up paying it back via higher income tax when drawing down their pension by ending up in the higher tax bracket.
Pensions are generous tax break and they benefit more higher income tax payers. It is much easier to be able to contribute to a pension when your basic needs are covered with a substantial income. As a couple, while our income are higher than they use to be, we pay less tax than we were before because we don't "need" in the short-term the additional income to finance our daily life.