taxation report - Tax hikes will exile well paid

ei.sdraob

heres an interesting article today (anyone have link to the actual report?)

anyways some interesting points highlighted for the "union"-ists

here we have some real numbers and facts for people to think about...

THE Minister for Finance, Brian Lenihan, has been warned by his officials that if he increases taxes in the Budget next month, high earners are likely to flee the country.

In a taxation briefing document seen by the Sunday Independent, Department of Finance officials say that emigration of even a "very small number" of high earners would have a "disastrous effect" on the income-tax base "desperately required" to fund public services.

The document contains the startling consequence of the emigration of just one worker who earns €119,081 a year -- "we would likely have to take an additional 132 workers into the tax net".

It states: "This means that for the joy of inflicting more pain on one of the highest income earners, we run the risk of having to tax an additional 132 of the lowest-income earners."

The briefing paper, drawn up as Mr Lenihan prepares next month's Budget, exposes what the Department of Finance sees as the flaw in the Irish Congress of Trade Unions' (Ictu) plan for national recovery -- specifically Ictu's call to "Tax the rich".

Last week Ictu said the tax system was "unfair" because "millionaires can legally pay far less tax than working people". Ictu said the tax system needed to be "rebuilt" and that the "wealthy" needed to "pay their share".

However, an analysis by the Department of Finance reveals that next year, [COLOR="rgb(139, 0, 0)"]143,000 people -- 6.5 per cent of the workforce -- will earn over €100,000 a year, and pay 47.93 per cent of all income tax[/COLOR].

The analysis also shows that next year almost 1.8 million people -- 80 per cent of the workforce -- will earn under €50,000 a year, and pay 18 per cent of all income tax.

Public sector unions are resisting a cut to their 300,000 members' pay and pensions in favour of increasing income tax, including the imposition of a new tax rate of 54 per cent on the "wealthy".

Workers in the public sector earn on average 25 per cent more than their equivalent in the private sector, according to studies prepared by both the Economic and Social Research Institute and the Central Statistics Office.

Siptu General President Jack O'Connor has gone further than the Ictu proposal. To protect the pay and pensions of public sector members, Mr O'Connor has suggested a new tax rate of around 60 per cent on workers earning over €100,000.

However, the Department of Finance briefing document, which has the headline "taxation statistics brief", outlines in stark detail the potential risks to specific tax changes facing Mr Lenihan.

It states: "The higher that marginal tax rates are increased, the more likely we are to lose high-income earners. The consequence of losing one worker from the top 1 per cent of income earners means that we would likely have to take an additional 132 workers into the tax net."

It adds: "It must be remembered that the highest income earners tend to be highly skilled and also highly mobile, thus they are likely to move abroad if severe levels of taxation are imposed on them.

"Given the mobility of such income earners, it is imprudent to rely too heavily on these income earners.

"Emigration of a very small number of such income earners would have a disastrous effect on the income-tax base that is desperately required to fund public services."

The document also states that a "structural change" has taken place over the last number of years in relation to the incidence of income tax on families in Ireland. For example, in the tax year 1999/2000, the top 4 per cent of income earners paid 33 per cent of the total yield.

In 2010, it is estimated that the percentage will have increased by 15 points to 48 per cent.

In the tax year 1999/2000, 82 per cent of those on lower incomes contributed 33 per cent of the yield. In 2010, it is estimated that their contribution will have decreased by 15 points to 18 per cent.

"Look at it another way," the document states, "in 2010, it is estimated those with incomes up to and including the average industrial wage will contribute about 6 per cent to the income tax yield. This compares with 13.5 per cent in the tax year 1999/2000."

http://www.independent.ie/national-news/tax-hikes-will-exile-well-paid---lenihan-1937114.html

NewDubliner

ei.sdraob wrote: »

heres an interesting article today (anyone have link to the actual report?)

Interesting, somebody is making tactical leaks at the Department of Finance:

The story begins:

"THE Minister for Finance, Brian Lenihan, has been warned by his officials that if he increases taxes in the Budget next month, high earners are likely to flee the country....In a taxation briefing document seen by the Sunday Independent, Department of Finance officials say that emigration of even a "very small number" of high earners would have a "disastrous effect" on the income-tax base "desperately required" to fund public services."

Does the Indo have a mole at Finance or just a cosy relatiionhip?

Diarmuid

Always good to learn from the mistakes of others.

Eric Pinchet, author of a French tax guide, estimates the wealth tax earns the government about $2.6 billion a year but has cost the country more than $125 billion in capital flight since 1998.

Flex

Diarmuid wrote: »

Always good to learn from the mistakes of others.

Nah, I dont believe that. The PS unions keep saying that we should raise everyones taxes to afford PS salaries and sort out the economy, along with all the other good ideas they wrote down on the back of their tissue paper. They probably know far more about economics than government officials, the ECB, economists, etc. who go around with their hocus-pocus qualifications and mumbo jumbo numbers

ei.sdraob

Flex wrote: »

Nah, I dont believe that. The PS unions keep saying that we should raise everyones taxes to afford PS salaries and sort out the economy, along with all the other good ideas they wrote down on the back of their tissue paper. They probably know far more about economics than government officials, the ECB, economists, etc. who go around with their hocus-pocus qualifications and mumbo jumbo numbers

the union leaders certainly have made themselves a very nice gold padded nest and salaries

they just haven't realized yet that the Celtic kitty is dead and rotting

once they come down to the reality of the workers they claim to represent they might realise how deluded they are

thebman

Flex wrote: »

Nah, I dont believe that. The PS unions keep saying that we should raise everyones taxes to afford PS salaries and sort out the economy, along with all the other good ideas they wrote down on the back of their tissue paper. They probably know far more about economics than government officials, the ECB, economists, etc. who go around with their hocus-pocus qualifications and mumbo jumbo numbers

See union leaders ask tax the rich in public but it never happens behind closed doors since they are high earners themselves.

Who in their right mind negotiates a pay cut for themselves? Certainly not the Minister for Finance nor the union leaders who fit their own description of elite.

dresden8

thebman wrote: »

See union leaders ask tax the rich in public but it never happens behind closed doors since they are high earners themselves.

Who in their right mind negotiates a pay cut for themselves? Certainly not the Minister for Finance nor the union leaders who fit their own description of elite.

Oddly enough Finance officials push for their own paycuts.

How ironic.

irish_bob

while the 250 or whatever number of super rich we have in this country will scoot off on thier private jets , small business which makes up the bulk of the private sector will go backwards also , a 60% plus tax which the unions are proposing will supress productivity and stiffle ingenuity , they will have to spare money for the tax man which could have been used to employ new people and grow thier business , this will in turn do nothing to reduce unemployment , reduce the tax take which will in turn leave public servants and those on social wellfare worse off

its short term lefty satisfaction at the expense of long term gain for everyone

ei.sdraob

irish_bob wrote: »

while the 250 or whatever number of super rich we have in this country will scoot off on thier private jets , small business which makes up the bulk of the private sector will go backwards also , a 60% plus tax which the unions are proposing will supress productivity and stiffle ingenuity , they will have to spare money for the tax man which could have been used to employ new people and grow thier business , this will in turn do nothing to reduce unemployment , reduce the tax take which will in turn leave public servants and those on social wellfare worse off

its short term lefty satisfaction at the expense of long term gain for everyone

exactly

these people dont realize how easy it is for some companies to move especially in the IT "knowledge economy" (i hate this word) sector

and no Ireland doesn't have lowest corpo rate in EU, a lot of companies are moving to Cyprus or example where its at 10%

or it takes a whole of few days to setup an offshore company in Seychelles and switch all of the income earned in markets outside of Ireland to go there, and its quite legal

me_right_one

I hope Jack O'Connor knows a bit about horses. He might be replacing his car with one soon

namenotavailablE

If anyone can find a link to the actual report please post it here.

NewDubliner

namenotavailabl wrote: »

If anyone can find a link to the actual report please post it here.

It's a confidential, internal, unpublished, report which the Indo gained access to by unknown means. :cool:

There's two possibilites, the story has been made up by the Indo or there has been a leak, possibly deliberate.

namenotavailablE

It might be helpful to bear the following analysis in mind when evaluating the report in the Independent:

• Based on a single person with totally standard tax credits and cut-off point amounts, a person grossing €119081 would pay the following deductions in a full year using the current rates for tax/ levies etc:

PAYE                    37519
PRSI / Health levy       8029
Income levy              [U]3263[/U]
Total deductions        [U]48811[/U]

• If 132 workers would need to be taken into the tax net to match this sum, they would each need- on average- to have total deductions of €370 per annum [€48811/132]. This would suggest ballpark average earnings of €18300 for each of the 132.

• However, it's worth pointing out that if each of these workers were to earn an extra €5 per annum (!), their total deductions would significantly increase due to PRSI rules. In this scenario, each worker would pay the following deduction amounts:

PAYE                     Nil
PRSI / Health levy       468
Income levy              [U]366[/U]
Total deductions         [U]834[/U]

In this situation, the total revenue take would require 59 workers being brought into the tax net rather than 132. Additionally, remember that all of these workers are earning in or around the minimum wage pay scale- if the average pay of each was higher, the number required would further decline.

Disclosure: these figures were computed using my spreadsheet at taxcalc.eu/monthlyss

givyjoe81

NewDubliner wrote: »

It's a confidential, internal, unpublished, report which the Indo gained access to by unknown means. :cool:

There's two possibilites, the story has been made up by the Indo or there has been a leak, possibly deliberate.

Well if thats made up then the author is quite talented, Nobel prize on the way.:D

me_right_one

Still, the point is the Intel's and thier engineers of this country will feck off to find a better deal for themselves if tax rises too much, and in fairness, who wouldn't. This would cause some more people to be brought into the tax net. So, 1 highly paid person leaves, more than one has to be brought into the tax net just to keep revenue levels the same. It doesnt make sense.

ParkRunner

Lenihan has already said that he wont increase income tax so that really is the end of that is it not? The tax bands will undoubtedly be broadened at the lower end and social welfare will have to be cut too to keep some form of motivation for those in the lower paid jobs to stay working.

I disagree with ICTU's proposal to impose an even greater tax burden on the wealthy as they have not costed it properly. They have just said the wealth from the boom times cannot all have disappeared, however they haven't backed it up.

On a side note I think that any monies saved from cutting social welfare should be specifically targeted at job creation, rather than shoveling more money into the banks. We need job creation stimulus urgently and the banks are not playing their part!

NewDubliner

givyjoe81 wrote: »

Well if thats made up then the author is quite talented, Nobel prize on the way.:D

Well, the Indo did bring us the 'Liam Lawlor in fatal crash with underage hooker' story, so they're quite capable of fiction.

On the balance I'd say that this was an 'official leak' as the possibility of the Indo having a mole in Finance is pretty horrific.

It just leaves us with the issue of collusion between Lenihan's office and a major oligarch.

the_syco

Meh. If someone taxed me 60%, I'd question why I worked here.

Euro_Kraut

the_syco wrote: »

Meh. If someone taxed me 60%, I'd question why I worked here.

Such rates are quite common on the continent. Although lower paid workers also pay higher taxes than here. I used to live in Austria and paid €250 tax a month on wage of €1200. Here, I would have paid nothing.

To compensate the standard of living is much higher. Better transport system, free health care, public parks, lower crime etc.

I think there needs to be a reevaluation of the type of society we want in Ireland. I genuinely believe most people here would pay higher taxes in return for a higher standard of living. I huge amount of political leadership would be required to get buy in from the public on this. Right now that leadership is lacking in Irish politics.

_Kooli_

Interesting info OP.

I earn just over that amount and we were just talking the other night about moving to London or the US (triggered by a job offer in London). or stick it out here and buy a house. Have to see what the tax situation is there, but would earn more than here and less stealth taxes too. Standard of living better for what you pay too.

I would be taking my other half with me who earns roughly the same, but hes a contractor so it might be more or less than me, depending on his year.

The tipping point would be tax increases.
I know we all need to pay more tax, but if its enough to p1ss us off we're gone. I dont really want to leave home, but nothing better than a hand in your pocket to make you move.

dermo88

While unpalatable, there is harsh reality, and I for one do not like saying it.

You cannot make a poor man rich by making a rich man poor. The leftist ideology of being all things to all people makes a mockery of finite resources. The concept of a fair taxation system is just that, its a concept. Its always a case of robbing Peter to pay Paul.

The economic boom since 1997 benefitted Irish society overall, but it brought in the poisonous divide between rich and poor, exploding unaffordable real estate and land prices. Eventually the hot air balloon ran out of Kerosene at enormous heights and crash landed.

The Good Samaritan of the Bible had more than good intentions, he had money too.

Meanwhile an insidious form of backbiting and begrudgery has returned to stalk the land as if Charles J Haughey never really disappeared. Public sector workers being mocked and derided. The Self Employed being regarded as tax evading sneaks. The people on the dole being mocked, and derided by those who have never had the misfortune of being there.

The perfect crime has been committed by those in charge of our Banking system, simply because the perpetators are hidden in shadows, cannot be found, and the money has disappeared. The money disappeared because it never existed in the first place, merely as electronic digits and kilobytes bouncing around the world. It stopped in Iceland for a while, came from Japan, landed for a stop off in transit in Ireland, bought a few houses, and is now heading off to Asia, Eastern Europe or the Middle East.

For a few years, the income tax system in Ireland was amongst the best in the Western world for the benefits it gave. This was fed by excessively high consumption taxes. In a small open economy, in a currency union, with monetary policies set in Frankfurt, real interest rates are actually approaching 12% in an Irish context.

This is set against the background of deflation, falling wages, and a shrinking economy. Frankly speaking, the faster Ireland takes the medicine, the faster it recovers. There is no anaesthetic, the anaesthetic is poisonous, hallucinogenic, and worse than the cure. The cure is cut public expenditure, get people who are capable of working employed, and make the country affordable. I always asked, why did things cost 10 Euro in Ireland and 3 Euro everywhere else. When I asked that during the 2000-2007 period, I was called stingy. When I ask it now, I am now told, because we treat our workforce well and "value" our people. When I ask it in future, I will be told that it is 3 Euro here, and 3 Euro everywhere else and it was damn painful getting there, but thank God we did it. We'll get back to the point we were around 1997 where 300-400 Euro was a reasonable and respectable wage. We'll get back to the point where a family can be supported on that. But castrating the elites that hold us to ransom such as the professions, the various "special interests" will mean complete reform, particularly of our political and electoral system. The problem is, noone in those positions will lead by example. We don't have a Kennedy who will say "Ask not what your country can do for you, ask what you can do for your country". We exported his ancestors from New Ross sometime around the 1840's, and imported a Cuban reject who mislead us, and his descendants continue to mislead us.

The money does not come from thin air. It has to be earned. The sooner we earn it, the sooner the problems are solved. Ireland is now part of the European Union, part of a greater structure, and as a result it should compare its overall cost base with the other societies it competes with on all levels. Ireland has to be aware of excessive pessimism with the desire for suicide rather than irrational exuberance of a leader wishing suicide for the pessimists.

I recall the 1987 election campaign. "Cuts hurt the poor, the sick, the elderly", and quickly, as soon as Fianna Fail won, the cuts followed. Ireland can continue with taxpayer and borrower largesse funded lies and populist nonsense, but it will end the same way as , Babangida's Nigeria, Manley's Jamaica and Evita's Argentina, as the brightest and the best leave, and the unemployed impoverished petrol bombing Clearys, Easons and Dail Eireann, as a police force strike, or collect bribes. Its far fetched, but this is how societies fail when the political and economic process fails. Therefore Ireland needs to be pragmatic and realistic.

Ireland can attempt penal rates of taxation again, but the problem is, we'll see the same despondency and despair return again like the 1950's and 1980's. it will see the return of nixers, cash only payments, under the counter payments, nod and wink, lock ins, do you want a drink or a transfer.

Honest people, not beholden to sectoral interests and poisonous ideologies are needed to help solve the problems we have. Despite the pessimism, with some common sense, Ireland will weather this storm better than the previous ones. There are good people in Ireland, and a few good men amongst the thieves in the barrel. We can let our own leaders fail, or we can get the Germans stepping in, saying "enough is enough", if we continue to behave like spoilt brats in the European Union gambling their pension money in the casino, playing the game of Double or Quits. The fact is, right now, there is a perception amongst the Irish public, irrespective of who is in charge amongst our own national leaders, its "tails they win, heads we lose". in such a context, would the intervention of Europe or the IMF be such a bad thing after all? The Rubicon must be crossed.

In our favour, the Northern Ireland problem, has broadly been solved. There is the freedom to insult our leaders and our politicians. There is the freedom to leave, and move anywhere in the European Union, and make a living. There is the freedom to choose. There is the freedom to be chosen.

Choose wisely and choose well, and all will be well eventually. I hope Irelands leaders have the wisdom, the ability and the knowledge to do that. The reality is, that it takes a brave leader to make unpopular decisions, but when they do, they get much greater respect in the long term.

skearon

the_syco wrote: »

Meh. If someone taxed me 60%, I'd question why I worked here.

Exactly, why punish people who work hard, contribute to society, create jobs etc etc

The UK has seen a flight of workers, especially from the City of London, to France and Germany when they introduced their 50% tax rate in their 2009 budget.

It's common sense that we need to encourage more high earners, not drive them away

_Kooli_

namenotavailabl wrote: »

It might be helpful to bear the following analysis in mind when evaluating the report in the Independent:

• Based on a single person with totally standard tax credits and cut-off point amounts, a person grossing €119081 would pay the following deductions in a full year using the current rates for tax/ levies etc:

PAYE                    37519
PRSI / Health levy       8029
Income levy              [U]3263[/U]
Total deductions        [U]48811[/U]

• If 132 workers would need to be taken into the tax net to match this sum, they would each need- on average- to have total deductions of €370 per annum [€48811/132]. This would suggest ballpark average earnings of €18300 for each of the 132.

• However, it's worth pointing out that if each of these workers were to earn an extra €5 per annum (!), their total deductions would significantly increase due to PRSI rules. In this scenario, each worker would pay the following deduction amounts:

PAYE                     Nil
PRSI / Health levy       468
Income levy              [U]366[/U]
Total deductions         [U]834[/U]

In this situation, the total revenue take would require 59 workers being brought into the tax net rather than 132. Additionally, remember that all of these workers are earning in or around the minimum wage pay scale- if the average pay of each was higher, the number required would further decline.

Disclosure: these figures were computed using my spreadsheet at taxcalc.eu/monthlyss

You have illustrated very well here that people earning more do, despite what most seem to believe, pay more tax.

>€48k compared to <€1k
And people want high earners to pay more tax :cool:

Eliot Rosewater

I actually wouldn't mind higher tax rates that much, it they were being put to good use. But to raise a tax you have to justify each item of spending that that tax will be used to fund. And at the moment there are far too many items of spending that are, frankly, ridiculous.

Social welfare is a big one. I understand the rationale for social welfare, particularly now that our society has developed a kind of of pitiful culture where it cant survive without it. But the sheer size of payments is over the top. €204.50 is the base rate for Jobseekers Allowance, on top of which people get rent and child supplement etc. It doesn't cost €200 a week to live nowadays, simple as.

Obviously we have the controversy with PS wages at the moment too. Any objective bystander will realize that Public servants are paid too much, and that re-adjustments need to be made.

Until such a time as cost cutting had been fully implemented, I dont see how any administration can raise taxes. Its economically retarded of an English speaking country in a global marketplace to give more reasons for people to leave.

the_syco

The only way that people would be happy with taxes being raised, would be if SW would also be slashed by the same percentage.

* 38% are estimated to be entirely exempt from Income Tax.
* The top 20% of income earners pay 77% of all Income Tax.
* The top 2.5% of income earners pay one third of all income tax
* The top 6.5% of income earners pay half of all income tax
* The top 12.5% of income earners pay almost two thirds of all income tax

http://www.finance.gov.ie/Viewtxt.asp?DocID=5647&CatID=54&m=p&StartDate=01+January+2009

Tipp Man

Deleted User wrote: »

http://www.finance.gov.ie/Viewtxt.asp?DocID=5647&CatID=54&m=p&StartDate=01+January+2009

It always amazes me how a good quality thread like this which has actual facts and figures gets so little input compared to some of the other threads which are based on tit for tat petty arguements.

spank_inferno

Tipp Man wrote: »

It always amazes me how a good quality thread like this which has actual facts and figures gets so little input compared to some of the other threads which are based on tit for tat petty arguements.

I havent thrown my opinion into this one because most of what was said in the thread I agree with and have nothing to add.

Doesnt mean we arent reading and agreeing.

LoLth

good thread. an interesting read alright and any points I would have made have already been covered quite well

I will say one thing about the income tax raise "solution". its the fairest thing the govt can do.

If, as argued by the unions, the avg public sector wage of 50k is merely statictical and workers are by and large on less than this (a statement I wouldnt discount as I do know a lady in the PS who has worked in IT for 8 years and is on either 49 or 51k - admit I'm not sure which) 8 years in a role + IT + qualified out her ears (MCSE, etc) would not , to me, be the average profile of a PS worker , or an industrial worker either for that matter but thats a different argument - then, raising taxes on 50k+earners shouldnt be a problem for the unions

Neither should it be a problem for the private sector workers if, as stated multiple times, the average wage is approx 38k.

by raising the 50+ rate those on below average earning will be left alone in both sectors.

by raising the 50k+ income tax rate you can lessen or avoid any raise on the 100k+ which stops any singling out of high earners (some of whom do earn their pay, lets be honest) and casts a wider net with lower impact yielding the same returns.

Alternatively:
hike the tax but also increase the number of tax credits by enough that those on less than 50k can absorb the increased rate.

anyway, just a thought that came up while i read this. Just that if the banners of "protect the vulnerable" are beign waved then there are mechanisms out there to do that and not completely punish the high earners.

for disclosure: I'm on less than 45k after 11 years in IT and I think my wage is pretty decent (but could always be more ). my wage covers my mortgage (<150k before anyone has a go at me about being a greedy homeowner who stretched themselves too far. I wont apologise for wanting to have some stability after renting in three different apartments in three different areas ) and an outstanding loan from my wedding with enough left over to pay for broadband, 1 online game subscription and a night out every now and then (approx once a month or so) and enough leeway to cover any minor emergencies and I can afford a holiday each year but nothing extravagant.

Tipp Man

LoLth wrote: »

good thread. an interesting read alright and any points I would have made have already been covered quite well

I will say one thing about the income tax raise "solution". its the fairest thing the govt can do.

If, as argued by the unions, the avg public sector wage of 50k is merely statictical and workers are by and large on less than this (a statement I wouldnt discount as I do know a lady in the PS who has worked in IT for 8 years and is on either 49 or 51k - admit I'm not sure which) 8 years in a role + IT + qualified out her ears (MCSE, etc) would not , to me, be the average profile of a PS worker , or an industrial worker either for that matter but thats a different argument - then, raising taxes on 50k+earners shouldnt be a problem for the unions

Neither should it be a problem for the private sector workers if, as stated multiple times, the average wage is approx 38k.

by raising the 50+ rate those on below average earning will be left alone in both sectors.

by raising the 50k+ income tax rate you can lessen or avoid any raise on the 100k+ which stops any singling out of high earners (some of whom do earn their pay, lets be honest) and casts a wider net with lower impact yielding the same returns.

Alternatively:
hike the tax but also increase the number of tax credits by enough that those on less than 50k can absorb the increased rate.

anyway, just a thought that came up while i read this. Just that if the banners of "protect the vulnerable" are beign waved then there are mechanisms out there to do that and not completely punish the high earners.

for disclosure: I'm on less than 45k after 11 years in IT and I think my wage is pretty decent (but could always be more ). my wage covers my mortgage (<150k before anyone has a go at me about being a greedy homeowner who stretched themselves too far. I wont apologise for wanting to have some stability after renting in three different apartments in three different areas ) and an outstanding loan from my wedding with enough left over to pay for broadband, 1 online game subscription and a night out every now and then (approx once a month or so) and enough leeway to cover any minor emergencies and I can afford a holiday each year but nothing extravagant.

Surely the problem is that there simply aren't enough people paying tax in this country and too many are paying at the lower rate.

If i am reading you correctly you want people earning over 50k to take the brunt of the hit by increasing the rate on them?? Without taking any allowance of the amount of people in this country that are paying very little if any tax, how is that equitable??

The problem in this country is that not enough are contributing enough, if i read your plan correctly you want to exagerate this even further??

LoLth

I would support raising income tax rates by a resonable flat rate across the baord. those earning more pay more as it is done on a percentage.

I would see this as a basic first step. Now, you'll get huge opposition to this with "the average PS wage is X" and "what about those on low incomes" etc etc. my comment would address these arguments.

take the average wage in both sectors and soften the blow for those below that wage. If, as the Public sector says, the vast majority are below the average then they should have no problem with this. If the private sector is right and the majority are actually around or above the average then more will be taxed and the public sector pays more tax by virtue of its higher pay rate.

similarly in the private sector: tax increase (of a moderate proportion). If as said by the public sector that the private sector have huge wages then grand, they will be taxed. If as espoused by the private sector the average inductrial wage is 38k then they can hardly object to a threshold of 50k as this will leave the majority of the private sector untouched.

By doign this, the governemt can raise revenue from both sectors in a fair and equitable manner. Without any targetting and without any favouritism (Cut the PS pay and PS hate govt. , dont and the private sector hates govt.) at least this way its fair.

those groups who want to protect the low income earner: satisfied

they tried to means test the medical card and look what happened. if the govt cant stick to its guns against a lobby group for pensioners (no disrespect intended) then how can we expect decent policy that isnt dictated by the group that shouts the loudest?

costs need to be cut. wages need to be reduced. If govt income increases at the same time then the cuts dont have to be as drastic (savings from cuts + govt. income increase balanced against deficit rather than just savings from cuts).