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

The two basic tax credits here mean that single people can earn up to 20k without paying any income tax.

It's more for lone parents.

Combine that with the 18k/36k exemption for people over 65, and that goes some way to explain why so many earners don't pay any income tax.


The 20k threshold here is higher than other countries, AFAIK.
 
T McGibney said:
Shoving the cost of current largesse onto the shoulders of unborn generations is always electorally palatable. But long-term it's a recipe for messy outcomes.
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Given that today's younger working generations will probably not be enjoying the same state pensions or easy eligibility to pensions like the current pensioners a proportion of whom are drawing full pensions without working and paying prsi for the full 40 years of working
 
I'm one of the four in ten. :) I'm a single parent with a son in third level and my credits allow me income of €29.5K before I pay any tax (some PRSI/USC is chargeable) and that's what I'm doing between a c. €12K p.a. passive income stream and additional PRSA drawdowns. (My SRCOP is also €48K).
 
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joe sod said:
Given that today's younger working generations will probably not be enjoying the same state pensions or easy eligibility to pensions like the current pensioners a proportion of whom are drawing full pensions without working and paying prsi for the full 40 years of working
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True and some of today's middle aged people will have worked for 40+ years and the State pension will be at a min subject to income tax (possibly at the higher rate when combined with a private pension) and may even be means tested.
 
DannyBoyD said:
Paying tax wouldn't push me out of the market.

Being stuck with a non-rent paying overholding tenant & taking two years to get my property back, thats what scares me.
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I worry about what I cannot control, that worries me a lot, tax, regulatory and constant Govt meddling.

That would push me out of the market, I'm at my limit with it now if I'm honest. Particularly RPZ.

Getting the right tenant? If i haven't mastered that at this stage, I'm in trouble...I can control that to the degree that I don't worry about it any more ;)
 
T McGibney said:
There is no point in cutting one tax and imposing another, especially when the same people will by and large be shouldering both
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Disagree with this.

Theres a cohort of (older) people who have gained enormous amounts of untaxed wealth through PPR appreciation who could be paying little or no income tax.

There is also a cohort of (younger) people paying extraordinary levels of income tax without having any wealth linked to the appreciation above and expensive rents.

By any non-emotive assessment of Ireland’s tax, it’s absolutely sensible that there is a rebalancing away from income tax on a small number of high earners to property tax and other forms of wealth tax. Any reasonable international comparison would conclude similar.
 
Zion2022 said:
Theres a cohort of (older) people who have gained enormous amounts of untaxed wealth through PPR appreciation who could be paying little or no income tax.

There is also a cohort of (younger) people paying extraordinary levels of income tax without having any wealth linked to the appreciation above and expensive rents.
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Yet both have to shoulder the burden of LPT, either indirectly (the young) or directly (the old).
 
What political party is going to act on this? Turkeys don't vote for Christmas (and we've got plenty of Turkeys in our system).
 
The article is confusing, more ways than one.

The title for a start.
But this theory of broadening the tax base? Are they suggesting broadening the income tax base, capturing tax of more lower income earners?
Or are they suggesting broadening the tax base as a whole?

Even if you are an income earner that doesnt pay income tax on what you earn you still pay VAT. As well as that, USC, PRSI, maybe property tax, car tax, carbon tax. You may be paying for education. Paying for refuse collection, TV licence etc....the tax base is still quite broad if you are earning and own a property and a car.
 
Protocol said:
The two basic tax credits here mean that single people can earn up to 20k without paying any income tax.

It's more for lone parents.

Combine that with the 18k/36k exemption for people over 65, and that goes some way to explain why so many earners don't pay any income tax.
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Deliberate policy design by governments for decades to keep people on minimum wage and state pension out of the tax net.
 
Sister Sara said:
Even if you are an income earner that doesnt pay income tax on what you earn you still pay VAT. As well as that, USC, PRSI, maybe property tax, car tax, carbon tax. You may be paying for education. Paying for refuse collection, TV licence etc....the tax base is still quite broad if you are earning and own a property and a car.
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The article is specifically about income tax.
 
Because, most people undervalue their property for LPT purposes.
This however is pointless, because Revenue stop any property sale, and look for back taxes on such low valuations.
 
Thanks @ClubMan .

So in order to widen the income tax base to capture some of those 1 in 4 (or 4 in 10?) who earn income but dont pay income tax.

One way would be to increase the National Minimum Wage, inducing wages increases up the income scale.
Another way would be to reduce tax bands or cut income tax credits.

I can't think of any other way. Are there other ways?
 
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