Should there ne a new 30% income tax band?

Sam Russell · 29-08-2022 8:38pm #1

There has been talk of introducing a new 30% income tax band. This is mainly coming from FG.

Now if there is an income tax giveaway in the upcoming budget, which would be better - move the current transition from 20% to 40% by increasing that 20% band by, say, €1,000 that would give those affected a €200 reduction in the tax, or should a new 30% band be introduced of €2,000 that would give the same benefit to those above the new transition to 40% but those caught in the 30% band would lose but compared to the simple widening of the 20% band.

Now a 30% rate sounds like a good idea, but do the maths - and it is just a stunt.

hotmail.com · 30-08-2022 9:46am

Talk of reducing taxation from FG is madness.

Liz Truss economics.

Staplor · 30-08-2022 9:57am

Any new tax band will give a benefit of about €100 a year, "but give us time to implement this fully"

Allinall · 30-08-2022 10:42am

https://www.boards.ie/discussion/comment/119540988#Comment_119540988

Not sure where you're getting that from?

The talk is there would be a €5,000 band @ 30% between the 20% and 40% bands.

For a higher rate taxpayer, this would be a benefit of €500 per year. (€5,000 @ 10%)

Sam Russell · 30-08-2022 11:00am

https://www.boards.ie/discussion/comment/119541216#Comment_119541216

Yes, that is so. But those caught in the top half of the 30% rate band, the benefits are missed out compared to a €2,500 move of the 20% band.

However, it would be good if there was a higher rate of tax at, say, 45% to recoup that tax benefit from those very high earners above, say, €100,000, or perhaps reduce some benefits like pension relief for the high earners. The current inflation emergency effects the very low paid on minimum wage and below the income threshold, and those paying 20% who are also badly affected. Those at the top end are not really effected because they can afford the higher prices.

There is a limited amount to go round, so giving tax relief might be a good thing, but already some is going on public service pay.

Staplor · 30-08-2022 12:30pm

https://www.boards.ie/discussion/comment/119541216#Comment_119541216

Picked the number out of my arse, if they introduce something benefitting me 40 or 50 from my monthly wages I'll be shocked. It's a tax bracket to grow year on year to keep the votes.

Bass Reeves · 02-09-2022 1:38am

https://www.boards.ie/discussion/comment/119541327#Comment_119541327

The problem is that many of those at the top of the 20% bracket receive support from HAP or FIS already. As well many of those that are caught by early entry to the 40% bracket are either younger career workers( nurses, Gardai, graduates from college) who suddenly hit the higher tax rate @ 38-40 k and then any further OT or pay increases are hit by a virtual 50% cut.

On the younger workers side these are more than likely working from home. For those older workers they receive less income supports from the state

Cookie_Monster · 02-09-2022 1:58am

why just dramatically simplify things, get rid of all the credits and what not and have a flat 17% tax on all income earned?

17% seems to be around the level required to maintain the tax base and be fair all round

Sam Russell · 02-09-2022 8:22am

https://www.boards.ie/discussion/comment/119557670#Comment_119557670

Great for those at the top of the earners league.

Not so good for those at the bottom or even mid-level. This is the 'flat tax' favoured by the right of FG.

Bass Reeves · 02-09-2022 9:20am

https://www.boards.ie/discussion/comment/119557906#Comment_119557906

i have not heard any FG politician looking for a flat tax rate.The present governmentis has plans to increase the minimum wage to a minimum living wage. Over the last ten years they have kept increasing the the low wage tax exemption which now stands at 18K for a single person. So you are posting rubbish

thedart · 02-09-2022 9:23am

It’s time to tax the welfare system, workers are being taxed to breaking point. It doesn’t make much sense giving the social migrants 3 square meals a day in a 4 star hotel and full dole.

Bass Reeves · 02-09-2022 9:34am

https://www.boards.ie/discussion/comment/119558160#Comment_119558160

When you apply tax credits they would have no tax to pay

thedart · 02-09-2022 9:36am

https://www.boards.ie/discussion/comment/119558230#Comment_119558230

They aren’t paying any tax as it is.

Sam Russell · 02-09-2022 10:21am

https://www.boards.ie/discussion/comment/119558145#Comment_119558145

I never said the ones pushing for a flat tax were members of FG. Just that they were to the right of FG - there is a difference.

Flat tax was the cry of the now defunct Renua party favoured by Eddie Hobbs and Lucinda Creiton. LC was a former FG minister.

Eddie Hobbs investment vehicle Brendan Investments lost 90% of its investor's funds by 2017. He resigned as non-executive director in 2015. He is not someone I would take any advice from - financial, political, or even a weather forecast.

Wanderer78 · 02-09-2022 10:42am

https://www.boards.ie/discussion/comment/119557670#Comment_119557670

flat taxes have been tried in other countries, it simply lead to further wealth inequality issues, as wealthier individuals simply could afford to avoid paying taxes, leaving the bulk of taxes being paid by the not so wealthy, leading to a significant fall in the quality of public services, which of course truly only effected lower classes....

rob316 · 02-09-2022 4:19pm

https://www.boards.ie/discussion/comment/119558160#Comment_119558160

They wouldn't pay any tax as everyone has tax credits. It's wrong to tax social welfare anyway, there is already a number of payments taxable which shouldn't be.

downtheroad · 02-09-2022 5:16pm

No income tax on first €17,000 income thanks to tax credits. Jobseekers is what, €203 per week plus double for Christmas, so €11k. Therefore no tax.

Wanderer78 · 02-09-2022 6:00pm

https://www.boards.ie/discussion/comment/119560968#Comment_119560968

always important to never forget consumption related taxes, and most money received via welfare is spent back into the economy, some of which is taxed....

downtheroad · 02-09-2022 6:05pm

https://www.boards.ie/discussion/comment/119561191#Comment_119561191

Ah we've had this before. That's unearned income so just going back to where it came from. They're still net takers not contributors.

Wanderer78 · 02-09-2022 6:12pm

https://www.boards.ie/discussion/comment/119561213#Comment_119561213

interesting, id argue rentier, or renting seeking activities, as true 'unearned income', whereby individuals and businesses behave in ways whereby their actions only truly extracts wealth from our economies, this is well known in financialised economies such as ours, whereby industries such as the fire sectors(finance, insurance and real estate) use their abilities to keep inflating asset prices such as property, in order to do so, these are the true net takers of our economies, which generally results in highly dysfunctional markets, serious supply problems, hyper inflated prices, rising wealth inequality, etc etc etc

Should there ne a new 30% income tax band?

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