Those who earn more ,should pay more

Latrade said:
To play Devil's Advocate then; if we include VAT, then can we break that down on who is also contributing to the VAT take?

Proportionally do higher earners also spend more/buy higher value goods and so therefore contribute more to the VAT intake?
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It would be very interesting to see a proper analysis of this, all right. Lower earners do tend to spend most/all of their income, so as a proportion of their income, they may well be paying more VAT. They are less likely to be buying Spanish/Bulgarian property or NASDAQ shares too.
 
Are some posters suggesting that those who earn more should not only pay more tax,but also they should pay a higher VAT?

Actually I thought that those who earn more,do already contribute more,More tax,more USC etc..
 
Complainer said:
It would be very interesting to see a proper analysis of this, all right. Lower earners do tend to spend most/all of their income, so as a proportion of their income, they may well be paying more VAT. They are less likely to be buying Spanish/Bulgarian property or NASDAQ shares too.
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I would guess they are also more likely to spend that income on 0% or lower VAT rate products.
 
I actually agree that you can't just look at income tax and say who's paying their fair share (that said, however, income tax needs to be considered in its own right in terms of the balance between incentives to work and the ability to collect enough of income tax aggregate to help balance the books - you can't go much beyond marginal rates of 50% without discouraging effort and you can't exclude large swathes of income from the tax net if you need to pay for decent public services).

You need to include other taxes also.

Then you need to look at what kind of benefits people are getting in terms of social welfare, healthcare, etc.

You can then come to the conclusion that a single guy earning €100k per annum is a patriot whilst a widow with a special needs kid is a drain on society.

Is there any purpose to such an analysis? I think not.

The guy on €100k needs to respect people in less fortunate cirumstances, but equally (or more importantly) people in less fortunate circumstances need to respect that some people are giving up half their incomes to provide them with a safety net.
 
Complainer said:
It would be very interesting to see a proper analysis of this, all right. Lower earners do tend to spend most/all of their income, so as a proportion of their income, they may well be paying more VAT. They are less likely to be buying Spanish/Bulgarian property or NASDAQ shares too.
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But if there's no quantitive analysis, how do we know? We can suppose all we want, but until then the only real proportional and actual analysis of tax paid and earnings is income tax.
 
DerKaiser said:
The guy on €100k needs to respect people in less fortunate cirumstances, but equally (or more importantly) people in less fortunate circumstances need to respect that some people are giving up half their incomes to provide them with a safety net.
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Very good point. But 'The Rich' are always to blame, because they are such a blurry easy target. Truth is, you can never take enough from 'The Rich'.
 
Complainer said:
You seem to forget that income tax is just one of the many taxes in place in Ireland today. VAT brings in more to the Govt than income tax. Everybody pays tax.
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This thread was about VBs comment on income tax. But I would still fathom a guess that "the rich" contribute more in VAT than less well off. I bought a new car a few years ago, and I think that the total tax bill was €7,500. A neighbour of mine bought a very nice Mercedes CLS and I think his total tax bill was €40,000. Big difference for the same amount of road usage.
Anyway, I would rather have a progressive sales tax than a progressive income tax, as the former encourages saving and investment while the latter discourages earning. Topic for a whole new thread though.

Sunny said:
Even under a flat system you would have to have a certain tax free allowance so this isn't about getting all the lower paid workers into the tax net.
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I would disagree with this, I think that everybody should contribute, and that laws, including tax laws should apply to everybody equally. Nobody would argue that some people should be exempt from laws that protect against burglary. Why should people be exempt from certain tax laws?

Complainer said:
PS Did anyone else have a giggle at the name of that PDF file?
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Yeah, in a very juvinile and satisfying way!

DerKaiser said:
The guy on €100k needs to respect people in less fortunate cirumstances, but equally (or more importantly) people in less fortunate circumstances need to respect that some people are giving up half their incomes to provide them with a safety net.
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The problem is that when the redistribution is by force, then those contributing more than they receive don't feel like they are being "charitable" and those receiving more than they contribute don't feel like a tangible person is being kind enough to help out. It all come down to two views (1) government is taking too much of my money and (2) I am entitled to a certain amount of money from government. When people voluntarily give up their time or money to a charity this is different. Those in receipt are grateful to those that give, and those that give can see the good their deeds are doing.


shnaek said:
Very good point. But 'The Rich' are always to blame, because they are such a blurry easy target. Truth is, you can never take enough from 'The Rich'.
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Always easy to scape goat a small group people.
 
Chris said:
Anyway, I would rather have a progressive sales tax than a progressive income tax, as the former encourages saving and investment while the latter discourages earning. Topic for a whole new thread though.
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I object to it being called 'progressive'. 'Progressive' is the name given to this form of taxation by some very smart robber. So everyone associates this type of taxation with being forward looking, advancing, broad minded etc just because of word association.
 
shnaek said:
I object to it being called 'progressive'. 'Progressive' is the name given to this form of taxation by some very smart robber. So everyone associates this type of taxation with being forward looking, advancing, broad minded etc just because of word association.
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Agree. From the taxpayers point of view, its regressive as earning more lowers your % takehome pay.
 
shnaek said:
I object to it being called 'progressive'. 'Progressive' is the name given to this form of taxation by some very smart robber. So everyone associates this type of taxation with being forward looking, advancing, broad minded etc just because of word association.
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LOL...the harder you work the more you lose...progressive innit?
 
It called progressive because the harder you work the amount by which you are screwed progressively increases.
 
I have no problem at all with the idea of an progressive tax system. The marginal value of money declines the more you earn. For example, the last €50 earned for someone on €20,000 is a lot more important than the last €50 for someone earning a €100,000. That doesn't mean you should screw higher earners with more taxation but it is an important fact to remember when discussing tax systems. It's all very well saying everyone should pay the same tax on every cent they earn but the reality is different. It's why no Country that I am aware of has managed it. Any of the Baltic countries that I know of with a flat rate have tax free allowances and other structures in place to protect the lower paid.
 
Sunny said:
I have no problem at all with the idea of an progressive tax system. The marginal value of money declines the more you earn. For example, the last €50 earned for someone on €20,000 is a lot more important than the last €50 for someone earning a €100,000. That doesn't mean you should screw higher earners with more taxation but it is an important fact to remember when discussing tax systems. It's all very well saying everyone should pay the same tax on every cent they earn but the reality is different. It's why no Country that I am aware of has managed it. Any of the Baltic countries that I know of with a flat rate have tax free allowances and other structures in place to protect the lower paid.
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The person on €20’000 gets to keep around €39 of their last €50 earned.
The person on €100’000 gets to keep around €22 of their last €50 earned.

It may be worth less to the person on €100’000 but is it worth half as much?

I find it strange that there is such resentment against the so-called super rich. If someone pay a million Euro a year in income tax (plus all that VAT) maybe they've paid enough? Maybe there should be a cap after which we say "you've paid your share, keep the rest".
 
Purple said:
The person on €20’000 gets to keep around €39 of their last €50 earned.
The person on €100’000 gets to keep around €22 of their last €50 earned.

It may be worth less to the person on €100’000 but is it worth half as much?

I find it strange that there is such resentment against the so-called super rich. If someone pay a million Euro a year in income tax (plus all that VAT) maybe they've paid enough? Maybe there should be a cap after which we say "you've paid your share, keep the rest".
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I have no resentment against the super rich. I have already pointed out on other threads the stupidity of pay caps and the idea of someone paying a higher rate of tax just because they earn over 100k.

I am also not saying that the current system is right. I am simply pointing out that the idea of saying that someone on the minimum wage should pay the same tax on every cent they earn as a person who earns a €1m is as absurd as penalising people for earning more and being successful like people in Labour seem keen on. Like it not, money does have a different value when you are on the poverty line.
 
But Sunny, how many people earn 1 million a year? I said on my first post that there could be some type of wealth tax on the super rich. However, I am not a high earner yet if I got a pay rise tomorrow, the government would see approx 60% of it. This does not make sense to me.
Your point re: the tax system in Baltic countries is interesting in that if we had a flat rate of tax here, maybe it could be balanced for the low paid by means testing things like child benefit, state pensions etc.
In other words, every pays the same rate of income tax but lower paid earners get help in areas like health and children through the welfare system.
 
Shawady said:
But Sunny, how many people earn 1 million a year? I said on my first post that there could be some type of wealth tax on the super rich. However, I am not a high earner yet if I got a pay rise tomorrow, the government would see approx 60% of it. This does not make sense to me.
Your point re: the tax system in Baltic countries is interesting in that if we had a flat rate of tax here, maybe it could be balanced for the low paid by means testing things like child benefit, state pensions etc.
In other words, every pays the same rate of income tax but lower paid earners get help in areas like health and children through the welfare system.
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Something could be done along those lines. Just in reality, probably very difficult to adminisitor but I am not an expert.

I earn a good salary (Not huge I should poaint out!) and pay the higher rate of tax and all the levies. I still have enough to go out every month for a few meals and take a couple of holidays a year. The Government raising my tax by another 1c although unfair, wouldn't ruin me. If I was struggling to feed my kids, the situation is different. I know these are extreme cases but the idea of a progressive tax isn't wrong. The implementation of it is what is flawed in many ways.
 
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