Tax Bands

billy the squid

I think the tax credit system should be scrapped in its current form. The tax free allowance system was better for the lower paid wishing to do the odd bit of overtime when it became availible.

with the old system, you could do your overtime and, as long as you stayed below the cut off point at the end of the year, you could make that little bit extra every once in a while.

with the new system, your cut off point is measured every week. meaning that if you earn over a certain amount or if your employer pays you back-dated wages in a lump sum, your you are made pay 40 percent tax on it.

while this system remains as it is now, a 30 percent tax bracket would cause hardship to lower paid people and would remove the incentive for them to do any overtime should their employer need them to do so.

ionapaul

dictatorcat wrote:

maybe not now, but it's not a question of living standards, it's about equality. Were the poor french any worse off than the poor germans or english in 1793? Were the Russians any worse off than other countries when the Tzar was toppled? No, it's about local inequality.

That only washes if you are arguing that the French and Russian revolutions had economic inequalities as their respective causes, rather than political inequalities or restrictions. I don't see the Irish revolution in sight, where the great unwashed and disenfrancised masses attack Leinster House and the Aras with their bare hands! Bertie to the Guillotine! Actually, that doesn't sound half bad...:)

Sleepy

That's fair enough. But why should someone who doesn't work half as hard as you, or isn't as intelligent or entrepeneurial as you get the same wages because Daddy's loaded or happens to be "good friends" with a local TD? Until the government pull the education system up to scratch to the point where there's no difference between the standard of education offered is no different between Blackrock College/Clongowes and the secondary school in the poorest area of the country. When everyone in this country has the same opportunity to educate and further themselves, you can talk of how success is based on "intelligence and entrepreneural spirit".

At present in this country success is far more based on who Daddy is, one's social standing and, to be honest, luck.

ionapaul

Luck will always have a lot to do with a person's life, no denying that or legislating against it. I also agree that our education system needs to be better funded (undergraduate education should be entirely free as far as possible, postgraduate probably not IMHO) - though not via additional taxing, rather a better use of the existing revenue. Despite my love of horse racing, I am particularly against the grants and tax breaks given to this industry and the betting industry.

'Who Daddy is' is important, no doubt (look at George W!), but this is also hard to legislate against. I would prefer more of a meritocracy - most of us would, I am sure the average boardster is more intelligent and better educated than the average Joe - and I know a system that rewards hard work and talent is in my best interests. I personally don't want to be 'held back' subsidising those less-willing or interested in working hard or those happy with the standard of life that working 'enough but no more than enough' entitles them to. I also want the chance to earn more than those with less intelligence, talent or drive do. Does that reflect badly on me?

One of the things I can say is that with regards 'who Daddy is', I know many instances where a person's background has mattered little when their eventual success is considered. My father was one of nine children born on an off-shore island in Ireland in the 1940s in a two-bedroomed craphole. Getting an orange for Christmas was a treat. Every one of his siblings is a success - the vast majority of my cousins are even more economically successful than their parents. One of my best friends in the States parents were Mexican immigrants with no English - her father was deported a number of times and once crossed the border in the boot of a car, finally getting amnesty in the 70s or 80s. He became a construction foreman, has a lovely house and lives far better than the vast majority in Mexico. In turn, his daughter worked hard, got an MBA from Berkeley, is a financial analyst with two properties in her 20s. I suppose these are the reasons millions are beating down the doors to get into the US and Ireland.

I believe a low-tax system allows those with drive, talent and a willingness to work hard to become economic successes. It certainly isn't perfect. But I think that some of the main problems people will point out (problems in America's case with African-American ghettos) aren't due to the economic system at all, rather they are cultural problems (racism, obviously) that need to be addressed.

Feel like that was a bit of a rant. Apologies if it reads that way.

puntosporting

The main issue i have with regards the current credits system is overtime!
I work for one of the largest american companys in ireland and im required to work massive amounts of overtime!
I find it a kick in the teeth that you have a cut off point every week and after that your hit with a 40% tax rate!
So basicaly the more graft you put in a week the harder the government hits you with tax,your penalised for working longer hours and contributing your time to the economy!

Meh

puntosporting wrote:

I find it a kick in the teeth that you have a cut off point every week and after that your hit with a 40% tax rate!

48%, when you count employee PRSI and health levies.

puntosporting

Very true did not think of those.

Victor

billy the squid wrote:

I think the tax credit system should be scrapped in its current form. The tax free allowance system was better for the lower paid wishing to do the odd bit of overtime when it became availible.

Eh, no. They work almost identically, if anything the process of moving to tax credits benefitted higher earners as allowances (now converted to credits) were increased.

Sleepy

ionapaul wrote:

Luck will always have a lot to do with a person's life, no denying that or legislating against it. I also agree that our education system needs to be better funded (undergraduate education should be entirely free as far as possible, postgraduate probably not IMHO) - though not via additional taxing, rather a better use of the existing revenue. Despite my love of horse racing, I am particularly against the grants and tax breaks given to this industry and the betting industry.

Agree entirely. Though in the short term, higher taxation will be needed to reform a badly run down system and personally I feel this should come from those who can afford to pay it.

'Who Daddy is' is important, no doubt (look at George W!), but this is also hard to legislate against. I would prefer more of a meritocracy - most of us would, I am sure the average boardster is more intelligent and better educated than the average Joe - and I know a system that rewards hard work and talent is in my best interests. I personally don't want to be 'held back' subsidising those less-willing or interested in working hard or those happy with the standard of life that working 'enough but no more than enough' entitles them to. I also want the chance to earn more than those with less intelligence, talent or drive do. Does that reflect badly on me?

Not at all, so long as those people are given the same chances as you are in regards to education. I should point out that I'm completely against the welfare state, but I believe that health, education and a decent police force are basic human rights, not simply there for those who can afford them.

One of the things I can say is that with regards 'who Daddy is', I know many instances where a person's background has mattered little when their eventual success is considered. My father was one of nine children born on an off-shore island in Ireland in the 1940s in a two-bedroomed craphole. Getting an orange for Christmas was a treat. Every one of his siblings is a success - the vast majority of my cousins are even more economically successful than their parents. One of my best friends in the States parents were Mexican immigrants with no English - her father was deported a number of times and once crossed the border in the boot of a car, finally getting amnesty in the 70s or 80s. He became a construction foreman, has a lovely house and lives far better than the vast majority in Mexico. In turn, his daughter worked hard, got an MBA from Berkeley, is a financial analyst with two properties in her 20s. I suppose these are the reasons millions are beating down the doors to get into the US and Ireland.

For every one of these people, I could probably point out three who only have a career thanks to our system of accepted nepotism.

I believe a low-tax system allows those with drive, talent and a willingness to work hard to become economic successes. It certainly isn't perfect. But I think that some of the main problems people will point out (problems in America's case with African-American ghettos) aren't due to the economic system at all, rather they are cultural problems (racism, obviously) that need to be addressed.

Feel like that was a bit of a rant. Apologies if it reads that way.

A low tax-system certainly does that, but it can't be given at the expense of basic public services. I think most of the problems in making something of yourself in this country exist because of the institutions and networks of the more successful professions. The legal profession would be a prime example of an organisation whose governing bodies have practically designed their training to engender an old boys network and keep the riff-raff out.

billy the squid

Victor wrote:

Eh, no. They work almost identically, if anything the process of moving to tax credits benefitted higher earners as allowances (now converted to credits) were increased.

I would disagree with that, If I earn more than €510 or there abouts in one week I'm hit with 40 percent tax. I only have to do something like 6 hours overtime to hit that bracket.

that would be two hours a day for three days, lets say tuesday, wednesday, and thursday. which for the company i work for can happen from time to time.

A 30 percent tax band would make overtime for me economically unviable.

Sleepy

The weekly threshold for the 40% mark is €538.46 in the current tax year and will be €566 next year. Assuming you're earning 28K (the current threshold p.a.) that equates to €14.17 per hour which is €85 for those 6 hours. Under the current system you get €44 for that overtime after tax (and PRSI, health levy etc) Under the systems the likes of which AngelofFire are promoting, you'd come home with more of that.

billy the squid

The annual cut off point was a better system for those doing sporadic overtime in my opinion.

bonkey

daveirl wrote:

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And some are born with none of these, nor any other "above average" skills.

I have no intention of becoming equal with someone who has no intention of working as hard as I do.

I'm curious...if that person currently had a higher standard of living than you, was earning more money, and so on and so forth.....would you still say the same?

Its one thing to argue that you don't want the lazy being given freebies to make them as well off as you....but what about those less well off than you who work harder than you do? Or those who work less than you do and earn more than you? No problem with those either?

jc

daveirl

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Victor

billy the squid wrote:

I would disagree with that, If I earn more than €510 or there abouts in one week I'm hit with 40 percent tax. I only have to do something like 6 hours overtime to hit that bracket.

And it would have been exactly the same under the old system. You are only taxed at the 40% rate on the extra earnings over that limit (Sleepy suggests €538.46), not on the entire amount. As the limit is cumulative it doesn't discriminate between someone who systematicly exceeds the limit against someone who merely averages above the limit (the PRSI system does discriminate because of the weekly exemptions).

Redleslie2

daveirl wrote:

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How about the people who run this site? They don't make anything out of it. Does that mean they're not "intelligent", that they have no "drive", that little or no time and labour has gone into producing and maintaining it?

daveirl

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billy the squid

Victor wrote:

And it would have been exactly the same under the old system. You are only taxed at the 40% rate on the extra earnings over that limit (Sleepy suggests €538.46), not on the entire amount. As the limit is cumulative it doesn't discriminate between someone who systematicly exceeds the limit against someone who merely averages above the limit (the PRSI system does discriminate because of the weekly exemptions).

I have to disagree i will give an example

in one week, If i were to do 10 hours of overtime say the first week in january and not do any more overtime, I would be taxed at 40 percent for the extra 4 hours regardless of whether or not I exceded my annual cut off point.

under the old system, I could earn the extra four hours without having to pay the 40 percent tax.

billy the squid

daveirl wrote:

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Those foreign nationals that do the jobs that no Irish person would be caught dead doing, (i.e. cleaning toilets, working in fast food restaurants) work their butts off, and sometimes have to put up with some horrendous crap, such as drunken members of the public, yet their money is crap. hardly rewarding.

daveirl

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Victor

daveirl wrote:

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It is when Bob from accounting just passed a night's worth of beer and burritos and has blocked the toilet.... again.

bonkey

daveirl wrote:

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Ever worked in a Nike sweatshop, daveirl? By your logic, it can't be hard.

jc