Commission on Taxation and Welfare report being heavily leaked

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joe sod

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Then we have an article in the independent today saying that the "commission on welfare and taxation " is recommending that pascal Donohoe increase fuel duties on diesel, abolish the agricultural fuel subsidy, increase prsi payments for self employed people and bring in congestion charges.
So it's all about increasing taxation but nothing about welfare reform.

So the people that will be affected are the younger people driving to work every day, that keep the country running . It won't affect those privileged enough to work from home on high salaries, or the pensioners or the welfare recipients.

It also beggars belief that a government funded organisation would recommend taxation measures that would exasperate our already high inflation and energy costs. Yet these very people will be unaffected by the measures they recommend. At the same time these people will benefit from the pay rises that the public sector is looking for to protect themselves from inflation
 
Apparently the Commission has sent its report to government and the newspapers are reporting on its contents:

www.independent.ie

Pension perks at risk as commission advises scrapping lower USC rates, tax reliefs and PRSI exemptions

Pensioners face losing a range of perks after an expert group advised the Government to scrap lower USC rates, tax reliefs and PRSI exemptions for retirees, the Irish Independent can reveal.
www.independent.ie www.independent.ie

www.independent.ie

Paschal Donohoe told to raise duty on diesel, axe the farming fuel subsidy and hike the local property tax

Increasing the excise duty on diesel for consumer and commercial vehicles drivers, scrapping the green diesel concession for farmers and a large hike in property tax, are among controversial recommendations an expert group has made to the Government.
www.independent.ie www.independent.ie
  • Scrap tax reliefs, lower USC and PRSI exemption for retired people
  • taxation needs to shift away from levies on labour and instead focus on taxing capital, wealth and consumption in order to promote environmental targets and enhance the overall progressiveness of the tax system.
  • welfare payments like maternity and illness benefits should be linked to an employee’s pay at the time they go on leave.
  • Farmers' green diesel to be scrapped - tax stuff based on their emissions
  • Property tax generally to be raised
  • Property tax surcharge on second homes.
  • A site value tax to stop hoarding
 
Brendan Burgess said:
  • Scrap tax reliefs, lower USC and PRSI exemption for retired people
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There is no logic for lower rates of USC for older people. USC is just another tax. The USC exemption for over-70s should be scrapped particularly given how generous the household benefits package and GP care packages are.

For PRSI I don't see the logic of extending it to over-66s. PRSI confers benefits, the main one being a state pension. My mother is in her late 60s, receives a full state contributory pension since 66, does some part-time work but pays no PRSI due to her age. During Covid she didn't get the PUP although her younger colleagues did. This was fair enough as she doesn't pay PRSI and already gets a full state pension.

It would be bizarre to levy PRSI on over-66s even though it gets them no extra pension and entitles them to no out-of-work benefits.
 
NoRegretsCoyote said:
It would be bizarre to levy PRSI on over-66s even though it gets them no extra pension and entitles them to no out-of-work benefits.
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This is true. When USC (Income Levy) was introduced the Health Levy was moved from PRSI into it. The lower rate of USC for those with medical cards should also be removed. This rule caused a mess, with people who qualified for a UK GP Doctor cards etc taking the mick. I know of one airline were all the pilots registered for cards in the EU countries they flew to. Finally PRSI needs to be increased for the self employed, now that they are entitled to the same benefits as employees.
 
Can someone explain how self employed increased prsi works. If a business pays prsi it is tax deductible so say profit 100k prsi 10k profit is 90k to pay tax on. For the self employed if profit is 100k and prsi 10k, the taxable income is still 100k ? Or am I missing something.
 
Nicklesilver said:
Can someone explain how self employed increased prsi works. If a business pays prsi it is tax deductible so say profit 100k prsi 10k profit is 90k to pay tax on. For the self employed if profit is 100k and prsi 10k, the taxable income is still 100k ? Or am I missing something.
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The only PRSI a business pays is employer's PRSI in respect of their employees.

Self employed pay 4% PRSI on the equivalent of their taxable income. That is not tax-deductible.

If they have employees, they pay employer's PRSI as a % of salaries paid. That cost is tax-deductible.
 
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I discussed this report yesterday in another thread ,these guys "commission on taxation and welfare reform " completely out of touch and living on their own planet in government land

More taxation for people that drive to work every day that have no prospect of working from home. No welfare reform except to increase it for some people. Abolish agricultural fuel pricing which will only increase food prices up further and exasperating high inflation. On top of that these guys get the benefit of the new public sector pay hikes to protect themselves from inflation but advising the government not to give other private sector workers the same relief, because it might contribute to inflation. Shocking out of touch stuff, get them back to the office and back to reality
 
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joe sod said:
On top of that these guys get the benefit of the new public sector pay hikes
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To be fair, the 13 members are from a variety of backgrounds, including the private sector, eg,

Sandra Clarke is a Chartered Tax Advisor and immediate past President of the Irish Tax Institute
Fergal O’Brien is the Director of Lobbying and Influence at Ibec
Rena Maycock is the CEO and Founder of Cilter Technologies
Marie Bradley is Managing Director of Bradley Tax Consulting

Also, the Chair is from the London School of Economics, so unlikely to be impacted by the new public sector pay hikes.
 
odyssey06 said:
Otherwise this is not a shift in tax burden. It's a grab for more tax.
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It is recommmending more taxation - but not on earned income - in this context:

- The report is also understood to warn Government that it will need to raise billions of euros in additional revenue, primarily through increased taxes, to fund age-related spending.
- More environmental taxes should be levied in order to make up for disappearing revenue streams as the economy decarbonises......The shift to electric motoring and the loss of traditional motor tax receipts is expected to leave a €5 billion hole in the public finances.
- More money should be committed from windfall corporation tax receipts to a rainy day fund or to paying down debt.........The report also finds that “long-term over-dependence” on corporation tax receipts poses “significant sustainability risks” and should be avoided.
- A site valuation tax that ......... would reduce the value of land, incentivising landowners to either develop it or sell it. This would clamp down on land hoarding and land speculation, often cited as drivers of higher housing costs here, while boosting the supply of land and lowering the cost of housing in the process.

From Irish Times.
 
odyssey06 said:
Can someone point me to a single tax or levy reduction here on labour?

Otherwise this is not a shift in tax burden. It's a grab for more tax.
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Hi Odyssey

We haven't seen the actual report yet, so we are getting only snippets.

But they might be suggesting a principle rather than specific proposals.

And we have a big deficit to make up through increased taxation. So maybe we increase capital taxes and indirect taxes so that employment is taxed relatively lower.

Brendan
 
Early Riser said:
To be fair, the 13 members are from a variety of backgrounds, including the private sector, eg,

Sandra Clarke is a Chartered Tax Advisor and immediate past President of the Irish Tax Institute
Fergal O’Brien is the Director of Lobbying and Influence at Ibec
Rena Maycock is the CEO and Founder of Cilter Technologies
Marie Bradley is Managing Director of Bradley Tax Consulting

Also, the Chair is from the London School of Economics, so unlikely to be impacted by the new public sector pay hikes.
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But they are highly paid professionals and not affected by the tax measures that they are recomending probably also benefit from the privilege of working from home. They all live in leafy dublin suburbs and hob nob with the journalists which explains why this report was leaked and got such prominence in the media. In other words they are using their connections to bounce the government into decisions that they favour

The tax measures and fuel duties will hit low to middle income workers that have no choice but to drive to work every day and are already suffering due to fuel prices and inflation. I stand by what I said. These people need a dose of reality
 
When they recommend more capital taxes to they want to reduce income taxes or is it just an exercise in taking more money from the same people. What happens when tax payers run out of cash?
 
Nicklesilver said:
When they recommend more capital taxes to they want to reduce income taxes or is it just an exercise in taking more money from the same people. What happens when tax payers run out of cash?
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In that case the system will give them money and call it social welfare. Most developed countries do similar.
 
www.independent.ie

Huge €6.3bn exchequer surplus gives Government more than expected for Budget

Ministers Paschal Donohoe and Michael McGrath are going into their Budget announcement this month with dramatically more money to spend than they expected.
www.independent.ie www.independent.ie

the state has 6.3 billion euro surplus this year, yet the government and this "commission on welfare and taxation" still playing down any tax cuts or raising of bands in order to protect workers from inflation. They have already committed to large welfare, public sector spending and other current spending increases.
Now when we find out that they have a huge surplus even after prolific borrowing and spending during covid they are still dreaming up new taxes for hard pressed workers and orchestrating with the media this talking down of any relief for middle income workers. All this green agenda stuff is just a new smokescreen in order for them to dream up new taxes
 
joe sod said:
yet the government and this "commission on welfare and taxation" still playing down any tax cuts or raising of bands in order to protect workers from inflation
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Can you point to any reports of recommendations from "this commission on welfare and taxation" regarding raising of tax bands to protect workers from inflation"? I doubt they would be doing so as that would be a government decision for the budget. And the government have been giving indications that there will be changes along those lines.

Nor has "this commission on welfare and taxation" :
joe sod said:
already committed to large welfare, public sector spending and other current spending increases.
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Is it part of the angry-man populist positioning to deliberately conflate the government and the Commission?

The Commission's brief is not this year's budget but to to “review how best the taxation and welfare system can support economic activity and income redistribution” while promoting employment and prosperity in a “resilient, inclusive and sustainable way”. Unfortunately it does not include a true expert from "the real people of Ireland", such as yourself, so it must be a conspiracy.

Viva la revolución!
 
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