The energy plan was huge and may well have contributed to the failure of the whole mini budget, but every interview, podcast, article, etc. puts the emphasis primarily on the tax cuts.
The energy plan was huge and may well have contributed to the failure of the whole mini budget, but every interview, podcast, article, etc. puts the emphasis primarily on the tax cuts.That may be so, but Truss' proposal for the government to underwrite frozen energy prices, at an estimated cost of £100 billion annually, on its own easily exceeded the cost of the tax proposed cuts. And that doesn't count a number of other spending increases promised in the mini-budget.
We'd need a whole different thread to even begin to scratch the surface of its folly.The main problem with the Kwarteng mini-budget was not its tax cuts at a time when the UK public finances were lurching into crisis (a problem not faced right now by Minister McGrath) but a whole array of unfinanced spending increases.
Are you sure of this?
I don't disagree with the general thrust of your argument. But the last time I looked, high earners in Ireland paid about the same level of tax on their earnings as other comparable countries. But the lower and middle earners paid a lot less.
I doubt it has changed. We are still a low tax country.
Brendan
The most obvious problem I can see is that it's grossly inflationary.Why is 1 million people paying some part of their tax at the marginal rate a bad thing? I'm just trying to first see what problems the current system is causing.
The most obvious problem I can see is that it's grossly inflationary.
Take rents. If a highly mortgaged landlord is paying 52% tax on their rental profits (up from circa 42% not that long ago), their only options are to 1. Charge the tenant higher rents to compensate. 2. Exit the market.
So we end up with a concurrent rent price spiral and an abject rental accommodation shortage.
Depends on which part of the US. Some states have low/no income tax but in others the state/local taxes are so high you are at European levels. If I lived in NY or CA, I would pay more taxes than I do here.Conversely when I lived in the States, it was the opposite, had to pay for everything but the taxes reflected that.
I find that very hard to believe. Which social benefits exactly?For higher earners in Ireland, we pay European levels of taxation, for access to US levels of social benefits.
the fact that these bands have not been raised along with inflation is what is blunt, crude , unfair and actually dumb, its the government that has been waving the sledgehammer and its the tax payers on the middle incomes that have been getting hit with it.By all means target landlords but altering the entry point of the top rate of tax is a fairly blunt instrument. Sledgehammer and nut comes to mind.
It's actually very typical.That's a very specific case
the fact that these bands have not been raised along with inflation is what is blunt, crude , unfair and actually dumb, its the government that has been waving the sledgehammer and its the tax payers on the middle incomes that have been getting hit with it.
You do know that at the last budget the entry point to the top rate of tax went from €36,800 to €40,000. That's an increase of 8.7% the budget was announced on September 27th.the fact that these bands have not been raised along with inflation
Income equality isn't worth much to the working families who these days struggle to save sufficiently for periodic financial emergencies like health insurance renewals and car replacements and end up being ripped off by scams like PCP financing on car purchases.
What increases in wages?But the increase in wages that family may have received should have helped.
Yes but again a legacy issue is these should have been raised long ago, and it still needs to be raised alot more if our taxation system is to maintain credibility and the veneer of fairnessYou do know that at the last budget the entry point to the top rate of tax went from €36,800 to €40,000. That's an increase of 8.7% the budget was announced on September 27th.
The rate of inflation in August 2022 was...
8.7%!
I don't know what you think a fair tax system looks like but I would think the most progressive tax system in the OECD is a good place to start.Yes but again a legacy issue is these should have been raised long ago, and it still needs to be raised alot more if our taxation system is to maintain credibility and the veneer of fairness
Most progressive in the OECD ≠optimal.I don't know what you think a fair tax system looks like but I would think the most progressive tax system in the OECD is a good place to start.
Me.Who, apart from yourself, thinks the current system is incredible and unfair?
Most progressive in the OECD ≠optimal.
There is presumably a good reason why every other country, many both more successful and historically less vulnerable to economic shocks than ours, has a system that leans less on higher earners.
Oh you've nearly a quorum!
Weak, how? We're clearly an outlier in terms of progressive taxation. The assumption that we're correct and everyone else is wrong may be a reasonable one but is hardly sustainable on its own without rigorous supporting data if you wish to cite it as a virtue. You can "presumably" do your own research on that if the mood takes you.But your argument is weak - the use of "presumably" isn't helping. Can you flesh it out with some evidence/credible material to support this?
Okay sticking with hyperbole, fair enough.Weak, how? We're clearly an outlier in terms of progressive taxation. The assumption that we're correct and everyone else is wrong may be a reasonable one but is hardly sustainable on its own without rigorous supporting data if you wish to cite it as a virtue. You can "presumably" do your own research on that if the mood takes you.
By the way, our tax base is even narrower now than it was in the last bubble.
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?