Are our tax rates too low?

{deleted by OP, before reply below appeared, sorry}

While there is a case to be made for investment in our services, there is also the fact that huge investment in our health system has yielded nothing in terms of results.

How many here would trust the government to spend revenues gained from higher taxation in a way that shows verifiable results? I know I wouldn't. In general they have fired money at problems instead of trying to resolve problems.

Take for example the fact that it costs 500k per year per person to keep a young person incarcerated. Why not invest in solving social problems at an earlier stage, thus saving money in the long run?

If I thought we had elected confident, intellegent leaders who are there to tackle tough issues then I would have no problem giving them more money. If we as a people supported policies of reform and change in education (as you have mentioned it) and also in good planning, so houses are built where there are existing schools and those schools are well funded (ie. sustainable development and good planning-something we have never had) - then I think that it would benefit greately from increased investment. Unfortunately I believe that dumping more money into education, as you suggest, would not yield verifiable benefits - as we have seen in health.

Only way I'd support higher taxes would be if they were spent solely on a program of building infrastructure which builds efficiency in to the economy(e.g. proper untolled roads) or reduces costs of provisioning services(e.g. modern hospitals, prisions etc.... which provide better service with fewer staff).

At the moment the government are happy to spend the money they recieve on paying ever more public sector workers and even then they divvy up the loot in accordance with the strength of the unions for each service area rather than targetting spending where it is needed.

And yes I'm aware that FF have used capital spending as a means of making some of their friends in the construction industry very wealthy so I suppose I wouldn't even trust FF to even organise a piss-up in a brewery.

No.sure if we gave them more money they would just piss it away anyway the real question is what are they doing with the money their already getting !.

Without going into details, I'd say they're not bad a present, but I would not want them going any lower. As others say, they don't have a great record on expenditure.

Whilst income tax rates may appear to be low by comparison with other European countries surely it has been well proven that we are not a low tax economy. Any shortfall in income tax revenue is easily made up in other indirect taxes like VAT, excise and stamp duties. I would rather a more transparent and simpler tax on income (albeit a higher tax) and less punitive "stealth taxes". Our VAT rates are high by European standards and duties on (modern day) necessities like credit and debit cards are unfair IMHO. That said the value for money on public expenditure to date has been appalling- why would anyone want to pay more?

We are a low tax economy.

Our income taxes and especially our social insurance rates are low. Take our employees PRSI rate of 4.5%, with allowances and exemptions. That compares to rates of 20-40% on the continent.

Yes, our excise rates tend to be higher, especially on tobacco and alcohol. But our excise duty on petrol and diesel is below average.

Also, our 21% VAT rate is not very much out of line:

Sweden/Denamark = 25%
France = 19.6%
UK = 17.5%
Germany = 16%

The overall amount of tax collected is under 30% of our GDP income, compared to the average of 40% of GDP across the EU.

I am not saying that this is a bad or good thing, nor the reasons why, I am just stating that we collect less tax overall than most other countries.

Carpenter said:

I would rather a more transparent and simpler tax on income (albeit a higher tax) and less punitive "stealth taxes".

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I agree with Protocol, we are a low tax economy any way you look at it. But, I am curious as to the statement above, why do people prefer direct taxes to indirect taxes. My own opinion is that indirect taxes are preferable as they give the consumer the choice as to whether to incur these taxes or not.

Protocol said:

We are a low tax economy.

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GDP is a very misleading figure for Ireland's wealth, quite a lot of wealth is created by foreign companies and distributed to shareholders rather than kept in the country. As such the difference between GDP and GNP is about 20% or so.

I'll bet that Ireland looks like a significantly higher tax country when we look at tax accrued compared to GNP.

Like direct taxes, stealth taxes have pluses and minuses. Overall I think they are a bad idea and a direct flat tax would be preferable.