Tax workers on minimum wage

censuspro · 05-10-2010 03:26PM #1

Today's indo

Can't see how you could tax minimum wage without reducing unemployment benefit/assistance.

€8.65 works out at €17,992 based on a 40hr week, 52 week year. Say they paid tax at 5% that would be €900 per year. Does anyone know how many people are on the minimum wage and roughly how much that would raise?

Banned Account · 05-10-2010 03:39PM

To be honest, I wouln't be sure about the figures but I do believe that if we are to assume that everyone in the country benefits in some way from the state, then all should pay some tax.

If that means dropping welfare rates then so be it. The tax base was reduced far too much over the past few years and is now getting to the stage whereby it is no longer feasible to assume that so few can continue to support the country.

jdivision · 05-10-2010 03:40PM

Unemployment benefit will have to be cut, simple as.

rorymcgrory · 05-10-2010 03:43PM

I think it needs to be cut too but not drastically. 2 or 3 euro at most.

Jarren · 05-10-2010 03:45PM

rorymcgrory wrote: »

I think it needs to be cut too but not drastically. 2 or 3 euro at most.

+1

i can agree with that:)

Geuze · 05-10-2010 04:07PM

I suggest JSB for 9-12 months at 250 pw

But JSA for a max of 12 months at 200pw.

No infinite JSA.

censuspro · 05-10-2010 04:10PM

Geuze wrote: »

I suggest JSB for 9-12 months at 250 pw

But JSA for a max of 12 months at 200pw.

No infinite JSA.

Well done, you've just increased unemployment benefit and assistance:).

R P McMurphy · 05-10-2010 04:11PM

jdivision wrote: »

Unemployment benefit will have to be cut, simple as.

Why cut Jobseekers Benefit? that should not be reduced. People pay high levels of PRSI so should get the benefit of JB at the current rate. Otherwise why pay PRSI at all. It is an insurance after all. Jobseekers Allowance should potentially be cut but certainly not benefit. Only lasts 12 months anyway

KindOfIrish · 05-10-2010 04:11PM

censuspro wrote: »

Today's indo

Can't see how you could tax minimum wage without reducing unemployment benefit/assistance.

Can't see how you could tax min. wage at all. Who will work for that money? Only student possibly.

Geuze · 05-10-2010 04:14PM

Yes, I would actually increase the JSB payment.

It is up to 405 dollars per week in the USA, where it lasts for 26 weeks (plus extensions during recessions)

It is about 60%-90% of former pay in other EU countries, for maybe up to 12-15 months, depends.

However, regarding JSA, it does not exist in the USA, nor in several EU countries.

So I would make the JSB payments higher, BUT I would abolish the long-term nature of JSA.

Long-term welfare dependency doesn't help anybody.

Indeed, I sometimes consider abolishing JSA, and only having JSB with added training / education supports.

Geuze · 05-10-2010 04:17PM

One other option is simply to get low earners paying PRSI, not income tax.

Currently, if you ear under 352pw, you don't pay PRSI.

I would abolish this exemption.

Iron Hide · 05-10-2010 04:20PM

Full welfare payments for people who have contributed to the the state (ie paid some form of tax). Cut the welfare payments to the people who have been on the dole their entire lives, and i mean cut 50% at minimum. I have no problem with people claiming dole, its the people who see it as a career i have a huge issue with.
Pay and PRSI you are more than entitled to recieve welfare payments, 16-17 year olds leaving school or finishing the leaving cert and jumping straight into the queue, give them sweet F**k all

Yag reuoY · 05-10-2010 04:24PM

JSA would have to be reduced to around €150 a week before any introduction of a tax on the min. wage.

I've seen and heard of many examples where it just doesn't pay to go back to work.

R P McMurphy · 05-10-2010 04:25PM

Geuze wrote: »

One other option is simply to get low earners paying PRSI, not income tax.

Currently, if you ear under 352pw, you don't pay PRSI.

I would abolish this exemption.

This is a solution that should be given careful consideration.Everyone should contribute, even people in receipt of social welfare should have token PRSI deducted

Iron Hide · 05-10-2010 04:25PM

Yag reuoY wrote: »

JSA would have to be reduced to around €150 a week before taxing the min. wage.

I've seen and heard of many examples where it just doesn't pay to go back to work.

Yes but theres at least some honour in working for your paycheck

Count Dooku · 05-10-2010 04:26PM

censuspro wrote: »

Today's indo

Can't see how you could tax minimum wage without reducing unemployment benefit/assistance.

€8.65 works out at €17,992 based on a 40hr week, 52 week year. Say they paid tax at 5% that would be €900 per year. Does anyone know how many people are on the minimum wage and roughly how much that would raise?

It will raise less then will be spent on collecting taxes.
PS unions want it, because it will allow to keep more clerks with public services and IBEC wants it, because it will force government to reduce welfare benefits.
If Fianna Fail will not implement tax for low earners now, then it will be problem for next Labour government, because it will ruine all LP hypocrisy.

This is why government has pressure from both sides

BluePlanet · 05-10-2010 04:26PM

It is not true that minimum wage earners are not contributing.
They are, they pay VAT like everybody else.

IBEC wants to reduce minimum wage have their cake AND tax them eat it too.

Yag reuoY · 05-10-2010 04:39PM

Iron Hide wrote: »

Yes but theres at least some honour in working for your paycheck

Maybe, but 40 hours in a ****ty job requires a greater incentive than honour for most people.

johnboy_123 · 05-10-2010 04:39PM

Guys its a sale everything must go

Social welfare has to be cut sorry but I think that we should adapt the system that the germans have...If you have the required number of stamps paid...You get your full pay for 6 months to help you while you look for a job every 6 months after it is cut in half to the point where after a couple of years you get nothing...As for people who have never worked it should be cut to shreds

beagle001 · 05-10-2010 04:46PM

Reducing JA by a large amount would be counter productive,more peope in hardship and 99% of that money gets put back into the economy by the recipients except for a few swindlers and a certain minority sending it overseas.
Why don`t they reduce child benefit,rent allowance and suplementary assistance fuel allowance should be cut as well as mortgage interest relief.
Ja and JSB should remain the same,unless the govt take at least a 30% cut themselves they cannot justify hitting the poor for their friends(bankers) bailout.
Bring in an id card for dole collection,stop sending it to peoples bank accounts and the money saved on all these areas should be pumped back into job creation schemes run by private sector.

whatawaster · 05-10-2010 04:48PM

Our spending will have to come down about 40% in the next 4/5 years.

Social Welfare - should be reduced by 10% a year for the next 4 years. I wouldn't touch disability benefits, but everything else is on the table.

- Pension must be cut. Pension should be abolished for those with significant other earnings. As should medical cards/travel cards etc. Ideology just goes out the window in times like these.
- Cut child benefit (not too much), and stop the payments at 16. Also stop payments for families with incomes over 50K per annum.
- Dole - cut by 10% per annum, and then one should only be able to claim the full amount for 12 months.

Minimum wage should be cut.
All income should be taxed. However small the tax is, everyone should contribute.

Overall i'd like to see a move away from the regressive consumption taxes, and look to take more of our tax from income tax.

Max Power1 · 05-10-2010 04:51PM

Yag reuoY wrote: »

JSA would have to be reduced to around €150 a week before any introduction of a tax on the min. wage.

I've seen and heard of many examples where it just doesn't pay to go back to work.

+1
how can they tax min wage without reducing JA? It doesnt pay to work as it is if you earn less than 25k, taking rent allowance, medical card etc into count

johnnyskeleton · 05-10-2010 07:01PM

censuspro wrote: »

Today's indo

Can't see how you could tax minimum wage without reducing unemployment benefit/assistance.

Deal.

Voltex · 05-10-2010 07:35PM

Max Power1 wrote: »

+1
how can they tax min wage without reducing JA? It doesnt pay to work as it is if you earn less than 25k, taking rent allowance, medical card etc into count

Well the minimum wage workers are being taxed at the moment...they pay the 2% levy.
I think this budget is going to be a ground breaker in terms of dismissing the crap that the most vunerable are the worst effected by recession.
Its a fact that for any type of domestic recovery we need to get middle Ireland spending again..so to further tax that socio group will be just add to the sluggish domestic spending figures.

Its also been shown that the majority of people on the minimum wage actually spend very little of their disposable income, being keener to save it and send it abroad in certain cases (take the case of romania where 40% of the countrys income comes...so to drag these people into the PAYE net wont have the deflationary impacts some observers are claiming.
then that means that we need to address social welfare....child benefit has to be reduced by 20% untill a system of means testing can be established.

Then JSA HAS to be tackled. We have a situation where an employee went on a 3 day week and is about €30 better off now. When we ask her to return to 5 days a week she will probably say no...how is that supposed to work. Same thing last year when we had a really busy period...i got a certain amount of casual staff in...when it came to paying them they were all expecting cash in hand...reason...they were all claiming JSA...when i offered one of them a full time job...I was told no...they were happier on social welfare....so you can see that if we have a system that allows for these sorts of anomolies to occour..there is a flaw in the system.

beagle001 · 06-10-2010 04:28PM

It is massively unfair to tax the minimum wage employees at the current minimum wage coupled with the price of everything in Ireland.
Take countries like Australia the minimum wage is 10.50 euro or 15 aussie dollars an hour,you get taxed 16-20 percent of this but at the end of the year you get a tax rebate which practically gives you the vast majority back.
Minimum wage is too low to tax in Ireland at a set percentage above anything like 5 percent and scrap the income levy if it does and then reduce ja allowance by maximium 5 percent and increase top earners.

dvpower · 06-10-2010 05:14PM

beagle001 wrote: »

It is massively unfair to tax the minimum wage employees at the current minimum wage coupled with the price of everything in Ireland.
Take countries like Australia the minimum wage is 10.50 euro or 15 aussie dollars an hour,you get taxed 16-20 percent of this but at the end of the year you get a tax rebate which practically gives you the vast majority back.

That sounds daft. Tax people who can least afford to pay tax and then give it back to them later. Why not let them keep it it in the first place.

beagle001 wrote: »

Minimum wage is too low to tax in Ireland at a set percentage above anything like 5 percent and scrap the income levy if it does and then reduce ja allowance by maximium 5 percent and increase top earners.

The minimum wage here is amongst the highest in Europe and contributes to the high costs here of basic goods and services.
What we need is a competitive economy with lower pay all round and lower prices.

beagle001 · 06-10-2010 05:56PM

How is that daft tax them 17 percent and give them back 12 percent one year later.
Government keeps 5 percent has access to 17 percent lessing the borrowing load and when people are given a tax back injection at a certain time of the year of say 2000 euro some will save majority of people will spend it and put is back into the economy its a form of stimulus.
This would also reduce the cost of living,might I add our social may well be one of the highest in the EU but Ireland is one of the most expensive countries in the EU.

szjon · 07-10-2010 12:53PM

Just one problem with all this, can someone point me to this remarkable pool of jobs that need to be filled by all those workshy layabouts? I mean, I keep an eye on the jobs market, are we suggesting these jobs will magically appear or are people seriously suggesting that people who can't find employment after a certain period should be thrown out of the economy altogether? What will we do with them then?

Some of you might just find yourself in this position in the not too distant future, my, wouldn't that be ironic?

dvpower · 07-10-2010 01:20PM

beagle001 wrote: »

How is that daft tax them 17 percent and give them back 12 percent one year later.
Government keeps 5 percent has access to 17 percent lessing the borrowing load and when people are given a tax back injection at a certain time of the year of say 2000 euro some will save majority of people will spend it and put is back into the economy its a form of stimulus.
This would also reduce the cost of living,might I add our social may well be one of the highest in the EU but Ireland is one of the most expensive countries in the EU.

The government 'borrowing' 15% of low paid workers earnings is daft. If the government need to borrow, they should do it on a voluntary basis from people who want to lend to them.

dvpower · 07-10-2010 01:28PM

censuspro wrote: »

Today's indo

Can't see how you could tax minimum wage without reducing unemployment benefit/assistance.

They should tax all income including JSA/JSB and child benefit and rent allowance and any other payments that are made to people.

Tax allowances and credits would take the most poorly paid out of the tax net. This would put all low paid people in the same boat regardless of the source of their income.
The PAYE allowance would provide an added incentive to work.

beagle001 · 07-10-2010 08:06PM

Where are the jobs I might ask

Tax workers on minimum wage

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