"Despite the significant Exchequer deficit the (Commission for Taxation) report does not recommend a rise in income tax rates and says that the combination of taxes and levies mean that anyone earning €75,036 is paying 53 per cent in taxes and levies to the State." You can almost hear the tears dropping from the eyes of the Times staff as higher income tax would be a favourite pet project for the paper.
41 per cent is tax, 4 per cent is PRSI, a further 4 per cent is a health levy and an income levy of 4 per cent. Well, we almost forgot other taxes and rates. All meaning that less than about a 1/3 of Ireland's productive (private sector employed= population supports the entire economy, with some 400,000 overpaid and under-worked public sector employees... Now, Irish Times wouldn't have anything to say about that would it?
A property tax will be introduced which will eventually replace stamp duty and while a new carbon tax on energy has been proposed. Now, what does this mean? We can only speculate, but eventual replacement of stamp duty implies that the two new taxes will coexist. My sources tell me that
- the new property tax will be based on self-assessment, which means it will yield huge rates of tax evasion, will retard even further property resale markets (as under-taxed properties will be held back from the market) and thus will lead to a renewed property crisis over time;
- the new tax will be a double tax with no credit given for recent payments of stamp duty, so in effect, it will be a new additional tax.
Well, obviously, another Times pet projects are artists’ exemptions. These should and will be scrapped, so Bono & Co can fully move out of the country. I wonder if that will make them preach less about doing good at the expense opf the ordinary taxpayers. I doubt.
Reliefs on union subscriptions and bin charges will be phased out. Hmmm - wonderful stuff. Union subscriptions relief was an honest admission by the state that it is so deeply in bed with the unions that even a tax amn can't separate the two. Now, let's pretend they no longer are... Does this change the reality of this state doing absolutely everything possible to appease the bearded men of the Liberty Hall? Not a chance.
Another rumoured proposal is a SSIA-type pension for those on lower wages with the State contributing €1 for every €2 saved by employees. Funny thing. Of course it raises two issues:
- Who will pay for it? You can imagine a family just above the margin threshold for such a subsidy that will have to provide tax payments for this pension scheme and at the same time pay for own pension. Fair?
- How will we pay for this? Assuming you have to save ca 40% of your income in order to afford a public sector-level of benefits at retirement, how can a country afford paying an additional premium of 40/3=13.3% on lower wages in taxes at the time when we can't afford to cover our current account deficit.