Effective tax rate?

[Strathspey]

I've searched numerous times to find out our effective tax rate and the effective tax rate across other economies.

In today's Indo there's a paragraph in Brendan O' Connor's piece, ''I'm all right' Jack may lose empathy of the people:
'But the realities of that seem to be that we are a very high-tax economy already, and having an effective marginal income tax rate of 55 per cent would drive away foreign investment and talented techie types.'

Does anybody have knowledge as to how this 55% is calculated and in addition would anyone know where I could find a reference to the effective tax rates across other geographies?

 

[Joe_90]

41% income tax, 4% PRSI, 7% USC, 3% surcharge USC on self employed income over €100,000.

 

[Brendan Burgess]

Hi Strathspey

The term "effective marginal income tax rate" is meaningless. The effective rate is the proportion of your income you pay in tax, which is a lot less than 55%. The marginal rate is the rate you pay on your marginal income, which is 55%.

I have discussed this at length in this post

"How much do top earners pay in income tax?"

 

[Protocol]

Marginal means extra.

MTR is tax paid on an extra euro income.

Top MTR in Irl for employees is 52%.

That 52% is not out of line with int'l norms.


Except that it kicks in here for single people on about 34k. That is the crazy aspect of our income tax system.

 

[Protocol]

My MTR is 52%.

But my average tax rate ATR is maybe 25-30%.

 

[Protocol]

Today Eurostat published some tax data across the EU.

See here for top MTRs and other rates:

[broken link removed]


That Eurostat summary is based on this book:
[broken link removed]

 

[Sean Bateman]

an effective marginal income tax rate of 55 per cent

Poor journalism and utter nonsense.

The marginal rate is the highest rate you pay and the effective rate is the percentage of tax relative to total income.