What is the Effective Tax Rate in Ireland?

[Brendan Burgess]

The Irish Fiscal Advisory Council has a report the strength of Income Tax receipts

https://www.fiscalcouncil.ie/wp-content/uploads/2022/07/AN16_A_bottom-up_sectoral_assessment_of_the_strength_of_income_tax_receipts.pdf

It seems to exclude PRSI which would add another 4% to it.

Brendan

 

[Brendan Burgess]

Revenue breaks down the tax by income cohort

Income Tax breakdown by Gross Income

www.revenue.ie

If I read this correctly

People earning between 27k and 30k pay 224m tax on €3.8 billion of income or 6%

People earning between €150k and €200k pay €1.6 billion on €5.8 billion of income or 28%

Brendan

 

[Firefly]

50% of total income tax is paid by the 6.5% of taxpayer units who earn more than 100,000

 

[Bow tie]

Is a tax paying unit always 1 person, or a jointly assessed unit also?

 

[Nicklesilver]

Does tax include USC/PRSI

 

[jpd]

A tax paying unit is exactly what it says - jointly assessed couples are 1 unit

Tax usually includes USC and not PRSI - USC is a tax on income, PRSI is Pay Related Social Insurance charge and is not considered as an income tax (go figure!)

It is a lot lower in Ireland than in most advanced EU countries

 

[Nicklesilver]

It looks like income tax is reliant on a pretty small number of people, just like the corporation tax!
if a new government increases these taxes by phasing out tax allowances for incomes over 100k and a new higher rate over 140k it will be increasingly difficult to keep very high skilled mobile workers in the country

 

[Sophrosyne]

To see the USC & income tax dataset you select this.
Then select the 3rd row down.

 

[NoRegretsCoyote]

50% of total income tax is paid by the 6.5% of taxpayer units who earn more than 100,000

This excludes PRSI which is paid by nearly every employee.

I wish the Revenue statistics would allow comparisons including PRSI.

 

[jpd]

That would violate the "PRSI is not a tax" rule

 

[ryaner]

It looks like income tax is reliant on a pretty small number of people, just like the corporation tax!
if a new government increases these taxes by phasing out tax allowances for incomes over 100k and a new higher rate over 140k it will be increasingly difficult to keep very high skilled mobile workers in the country

It is already difficult to keep them, and nearly impossible to get people to come over after they start looking at costs after tax.

 

[Purple]

This excludes PRSI which is paid by nearly every employee.

There's no PRSI on the first €18k of income.

 

[Itchy]

Revenue breaks down the tax by income cohort

Income Tax breakdown by Gross Income

www.revenue.ie

View attachment 6478

If I read this correctly

People earning between 27k and 30k pay 224m tax on €3.8 billion of income or 6%

People earning between €150k and €200k pay €1.6 billion on €5.8 billion of income or 28%

Brendan

On the P21 Balancing Statement, Panel 8 (I think) quotes the 'Effective Irish Tax Rate'. Ours would seem to tie in with that figure, more or less (2 PAYE employees with PHI relief and max pension/AVC contributions for our age, no other reliefs). Though I can't seem to determine from the statement how exactly they calculated that. And it looks like PRSI is not included as you noted.