# ESRI report on effective tax rates in Ireland



## Brendan Burgess (12 Nov 2020)

I will study it in full later, but the summary is interesting.  Probably best to look at the last line 2012 -2017 






						Effective tax rates in Ireland
					






					www.esri.ie


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## NoRegretsCoyote (13 Nov 2020)

There is not much surprising in this. Ireland tax corporate profits and personal income lower than elsewhere. Consumption taxes are high (VAT, VRT, excise).

High consumption taxes are a policy choice and is one of the reasons that consumer prices are high compared to elsewhere. A small market and lack of competition in certain sectors is another.


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## Purple (13 Nov 2020)

NoRegretsCoyote said:


> There is not much surprising in this. Ireland tax corporate profits and personal income lower than elsewhere. Consumption taxes are high (VAT, VRT, excise).
> 
> High consumption taxes are a policy choice and is one of the reasons that consumer prices are high compared to elsewhere. A small market and lack of competition in certain sectors is another.


The marginal tax rate on labour is very high here, which is an indicator of how narrow out tax base is.


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## odyssey06 (13 Nov 2020)

I expected bigger difference on consumption taxes.


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## Purple (13 Nov 2020)

odyssey06 said:


> I expected bigger difference on consumption taxes.


Consumption taxes include indirect taxes. The Excel sheet gives them as "Consumption ETR including indirect taxes". We have very few (no water charges, extremely low property taxes etc) so that brings it down.


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## odyssey06 (13 Nov 2020)

Purple said:


> Consumption taxes include indirect taxes. The Excel sheet gives them as "Consumption ETR including indirect taxes". We have very few (no water charges, extremely low property taxes etc) so that brings it down.



Property taxes would affect it, hadn't considered that.

On the other hand, we have a lot of indirect taxes on vehicles, fuel, alcohol.

Water charges wouldn't be a tax though would they... part of the reason it turned out so messy?
Unless you mean in other countries indirect taxation funds it?
For comparison, I don't think electricity prices would be included, but maybe PSO levies would be? And insurance levies?


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## Purple (13 Nov 2020)

odyssey06 said:


> Property taxes would affect it, hadn't considered that.
> 
> On the other hand, we have a lot of indirect taxes on vehicles, fuel, alcohol.
> 
> ...


Good point on water charges.


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## Protocol (13 Nov 2020)

odyssey06 said:


> I expected bigger difference on consumption taxes.




Our VAT rate at 23% is a bit above the EU average.

However, many goods are exempt from VAT, so that would pull down the effective rate.

Our fuel excises are not the highest, low tax on electricity.

Very high excise on tobacco.


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## Paul O Mahoney (12 Dec 2020)

" Effective tax rate" is an oxymoron add in PRSI and USC and that becomes the "Effective tax rate" .

Then as others have mentioned all the indirect taxes.

This is a term that really gets me, its as if they are trying to sell a very clear lie.
ut 
Its up there with our GDP is reduced by 20% due to tax repatriation by multi nationals , most multi national companies don't do repatriation anymore as the tax code at home is higher,  I know Trump tried to get the US ones to cough up, a few did, but our CT receipts rose


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## Protocol (12 Dec 2020)

Paul O Mahoney said:


> " Effective tax rate" is an oxymoron add in PRSI and USC and that becomes the "Effective tax rate" .



USC is an income tax, and of course is included in the analysis.

Social contributions are also measured in the article.


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## Protocol (12 Dec 2020)

Paul O Mahoney said:


> Its up there with our GDP is reduced by 20% due to tax repatriation by multi nationals , most multi national companies don't do repatriation anymore as the tax code at home is higher,  I know Trump tried to get the US ones to cough up, a few did, but our CT receipts rose



Please that the difference between GDP and GNP is due to income flows, yes, but note that the incomes do not have to return to the parent country.

Where they go is not relevant, they could stay in the AIB in Cork city - the key issue is that we don't own that income.


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## Paul O Mahoney (13 Dec 2020)

Protocol said:


> USC is an income tax, and of course is included in the analysis.
> 
> Social contributions are also measured in the article.


Maybe quoted in the article but on our form 11 not included. ERSI aren't the revenue and its the revenue that matters.


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## RedOnion (13 Dec 2020)

Paul O Mahoney said:


> Maybe quoted in the article but on our form 11 not included. ERSI aren't the revenue and its the revenue that matters.


The thread is about an ESRI report. Surely what's in the report is what matters?...


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## Protocol (13 Dec 2020)

The article aims to measure effective tax rates here, and so obviously all relevant taxes are included.

How workers in practice pay each tax (annually, PAYE, to the Revenue, to the Collector-General) is not directly relevant.


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