Key Post Nevin Institute: " low paid pay more tax"

[TRS30]

Hi Gerry

It's hard to get everything in during a 12 minute piece.

But the piece highlighted a few issues
The effective rate of tax on salaries of €150k is 41%
The higher paid, pay most of the taxes.
The lower and middle earners pay a lot less than their counterparts in Europe.

The programme was flagged as covering "who has lost the most due to the austerity budgets" but both Seamus Coffey and Micheál Collins reminded us that the big losers, were those who have lost their jobs.

I brought up the NERI nonsense that the bottom 10% pay the same effective tax rate as the top 10%.

Overall, I was very happy that the programme produced more information and facts than most other programmes and commentators who just talk about the squeezed middle.

The more of Prime Time I watch the more disillusioned I become. It seems to be targeted at the non educated (financially) audience and relies on sound bites and soft interviewing.

Brendan, the piece you did could have been much more informative if they had given a bit of background, i.e. Nevin Institute is a mouth piece for Unions etc and the reason for the report (try to influence government decisions re budget).

The interviewer also totally ignored the inaccuracies you raised about the report and didn't ask Mr. Collins any hard questions. Just took what he said at face value. I appreciate they did the same for you however you where questioning his figures not the other way round.

I appreciate it was only a short piece so was hard to go into too much detail and also felt they allowed Mr. Collins to speak for much longer than you.

Could have been a very interesting piece however was 'watered down' by Prime Time as seems to be the norm from what I have seen.

 

[Brendan Burgess]

Hi TRS

My initial objective was to discredit the NERI nonsense.

But the programme just ignored it, which was a much better strategy. It showed the Effective Tax rate for salaries of €150,000 to be 41%. That is better than showing the NERI figure of 24% and forcing me to attack it.

Séamus Coffey made it quite clear that the lower paid and middle earners pay low tax.

I don't think you will find that message on any other programme and rarely in the media. So it was too short and maybe Micheál and I could have been challenged a bit more, but overall the programme should have challenged a few myths.

Brendan

 

[Brendan Burgess]

The Tax Institute has published the following

[broken link removed]

For someone earning €18,000 in Ireland, they pay the lowest effective tax rate at 4.88%

The effective tax rate for someone on the average wage, is very low by comparison to our competitors.

As wages rise, the effective tax rate becomes the same as our competitors.

Brendan

 

[TRS30]

The Tax Institute has published the following

[broken link removed]

For someone earning €18,000 in Ireland, they pay the lowest effective tax rate at 4.88%

The effective tax rate for someone on the average wage, is very low by comparison to our competitors.

As wages rise, the effective tax rate becomes the same as our competitors.

Brendan

Does this take into account PRSI and USC?

 

[Brendan Burgess]

I presume so as they roughly tally with my figures, but there are few details of the assumptions on the document.

 

[Brendan Burgess]

They seem to have come up with a new way of raising tax

Neri also wants an increase in employers’ PRSI on the portion of annual income over €100,000, from 10.75 per cent currently to 17 per cent. It said this would affect just 45,000 employees and could generate €100 million a year for the State.

 

[T McGibney]

They seem to have come up with a new way of raising tax

Neri also wants an increase in employers’ PRSI on the portion of annual income over €100,000, from 10.75 per cent currently to 17 per cent. It said this would affect just 45,000 employees and could generate €100 million a year for the State.

€2,222 per employee.

That'll really encourage multinationals to locate talented staff here.

 

[ashambles]

Another proposal do with earning over 100,000? That's quite the fixation they have.

Probably 10% or so of 100k+ earners are paid by the state? So I'd expect there's no employers PRSI paid at all for at least some of those. So
the return from their proposal would be less than they think.

I believe on Prime Time with Brendan Burgess they tried to argue that maintaining the 3% extra USC on non PAYE over 100k would generate 171m. Now we're being told that an extra 6.25% on PAYE over 100k would generate 100m. Odd they seem to have switched track, was the 171m figure correct?

But in any case I prefer this new proposal which is guaranteed to be rejected than the USC one which Noonan would find tempting. On previous form he'd phase out the 3% extra as promised but add on a new 4% charge.