Also the self employed dont get sick pay, holiday pay and all the other perks employed people get.I fail to see the inequity here Brendan.
The 11% is a de facto tax on employers, a good proportion of whom are self employed. So, apart from independent freelancers, most self employed people will pay more in PRSI than an employee on the same earnings.
Total logic fail there Brendan, sorry
Higher-rate tax payers are already paying 52% tax and what do we have to show for it?
Hi BrendanHi Tommy
It might be a bit difficult for people to see, but when you think it through, Employers PRSI is a tax on employees.
I'd argue Brendan that increases in employment taxes lead to less employment.Tommy
You of course technically correct.
But the reality is that the employer taxes and the employees wages come from the same pot. Which is why increases in employment taxes lead to lower salaries. So they are, effectively, taxes on employees while legally, they are charged to employers.
Brendan
Hi Brendan
If Employers PRSI were a tax on employees, that would imply that employees pay it. That is clearly not the case.
If its rate increases, an employer cannot legally recoup that additional cost from their employees.
If its rate decreases, an employer is not legally obliged to pass the savings on to their employees.
If a serving employee reaches PRSI exemption age, they do not become legally entitled to a pay increase to recoup the Employers PRSI saving associated with their salary.
It's a tax on employment and a cost of doing business.
That's a slightly different argument.Benson & Hedges send the cheque for excise duty on tobacco to the Revenue.
But smokers pay the tax.
This is something called the incidence of taxation, as in, who does the tax fall on.
CT is paid by Ryanair on their profits, but effectively the staff, customers and shareholders are paying it.
Employers PRSI is paid by the firm, so they see it is a cost of business, but the incidence is shared by the emolyer and employee.
I agree completely.I'd argue Brendan that increases in employment taxes lead to less employment.
(It's almost impossible to cut someone's salary except in rare circumstances.)
And that increases in say, automation and mechanisation costs relative to employment costs lead to higher employment.
Find out what your spouse will actually be entitled to as a pension. Don't rely on 'as far as I know its a pretty good pension'
Do you pay your tv licence though?At a meeting with a solicitor recently, I was struck by how, in a conversation about inheritance and tax, the professional advisor assumed that my default position would be to minimise my own ‘tax bill’ in relation to my potential inheritances, and to minimise my children’s tax bill in relation to theirs.
It seems to me that, if we want a better society, with good public services, a health system, a system for ensuring most people have somewhere to live, we should be willing to pay more tax. Or at least start rethinking our attitude towards tax as a burden, whereas it might be something else entirely, something that is necessary for the public good.
Maybe tax is the future, a means to unlock human decency and solidarity with others? A good thing, in other words; a price many are willing to pay?
Am I alone? Can we rehabilitate taxation as a means towards creating a better society?
Or am I hopelessly naive?
What about the people that receive a pension without contributions. In 2020 a fifth of pension recipients were non contributory, should that also be fully funded by those who pay state pension contributions?My key point is that it would be better to link benefits to the contributions made.
There is no way that the €1,200 paid in PRSI by someone earning €30,000 a year is enough to fund their Contributory Old Age Pension.
I agree completely.
In my company we reduce our prices to our customers each year, despite higher rates, raw material, utility and insurance costs and despite that we increase our margins.
We do that by getting more efficient and better at what we do. We've cut our employment level by 25% in the last 5 years without reducing turnover by process improvements, capital investment, up-skilling and automation.
When the State can reduce it's costs in the same way then I'll have no complaints about paying over half my income in taxes. When the HSE published data showing how much cheaper it is to process patient through A&E this year than it was last year, how many more patients they can process with the same staff and resources, etc then they won't be wasting my money.
The same goes all administrative functions in every area of the State sector. All else being equal the cost of delivering the same services should get cheaper year on year, not more expensive because the people who are delivering them have had a year to get better at their jobs and improve their processes and procedures. If they aren't doing that then they are not doing their jobs properly.
To the State and State sector:
Stop wasting my money and do your job properly.
Stop moaning and complaining about lack of resource and do your job properly.
Stop making excuses for your own inefficiency and incompetence and do your job properly.
Then you can have my money without me resenting your incompetent use of it. They you will be fulfilling your side of the social contract, just like I do when I give you over half my income.
A self employed director may have a lower PRSI percentage contribution but may pay a much higher amount. Why should he/she not get a commensurately higher pension? Surely the amount is a more important measurement than percentage if the benefit amount is fixed?
Reading through this thread, most people believe that efficiencies can be found is having a lean, mean public service by cutting out waste (good luck with that). I was thinking, "they're going to have to make a load of public servants redundant to do that...and pay them a good severance package and they'll still have their pensions. Otherwise, it will be a recruitment freeze for years to reduce numbers as people retire.We do that by getting more efficient and better at what we do. We've cut our employment level by 25% in the last 5 years without reducing turnover by process improvements, capital investment, up-skilling and automation
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