yellowmoose
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fair enough but where is the research to say that they are more likely to be jointly assessed in Ireland which is what was claimed?
fair enough but where is the research to say that they are more likely to be jointly assessed in Ireland which is what was claimed?Higher earners are more likely to be married and married people are more likely to be high earners. There are decades of economic research on this.
This of course is true on average only, there are lots of low income married people and low-earning unmarried people.
Aren't most married people jointly assessed?fair enough but where is the research to say that they are more likely to be jointly assessed in Ireland which is what was claimed?
AFAIK it’s because that’s where the Department of Education payroll function is.The standout statistic for me on PAYE Income Tax and USC receipts by County is that Westmeath ranks third (after Dublin & Cork).
Neither that statistic, not the chart generally, make any sense.The standout statistic for me on PAYE Income Tax and USC receipts by County is that Westmeath ranks third (after Dublin & Cork).
I'd have lost the bet on that being the case.
MNCs & MO'L?
This makes sense.AFAIK it’s because that’s where the Department of Education payroll function is.
So all teachers recorded as having a Westmeath-based employer.
In theory for the rate of tax to be kept the same everything needs to rise with wage inflation.From the Irish Times article:
"The group’s income tax paper also costed a number of possible income tax changes. It estimated that indexing the income tax system against wage growth of 4.5 per cent would cost just under €1.2 billion for the full year."
Can anyone explain this second sentence? I don't understand what it means?
There are big social welfare advantages for low earners to not be married.Why would higher earners be more likely to be married than lower earners?
Ah, ok, got it thanks @Zion2022 .In theory for the rate of tax to be kept the same everything needs to rise with wage inflation.
Tax credits go up 4.5%. Entry point into 40% income tax goes up 4.5%. Amount of transferable benefit between spouses goes up 4.5%, USC band etc etc.
Some countries do this automatically. It’s not a tax cut. It’s just standing still. In Ireland it’s positioned as a tax cut ‘giveaway’.
The annualised ‘cost’ of doing so is €1.2bn. Or more accurately, if not done the government is increasing the rate of taxation to the tune of €1.2bn.
It actually ‘costs’ them less than nothing when this happens.Ah, ok, got it thanks @Zion2022 .
With my new understanding is it not correct to say that it costs the government nothing because the equation is balanced on both sides?
From Income Tax 2023: Insights on PAYE Taxpayers, section 2.2. Gross PayHow much of this is due to the very progressive nature of our income tax system?
Or is it also a reflection of high market income inequality?
I don’t think that’s correct.The upshot is that the top earners pay 25% of the total taxes but also earn 25% of the total gross pay.
An interesting observation and it probably does.I think the PAYE “employee” taxpayer numbers include DB pensioners and ARF drawdowns income tax deducted at source.
Due, in the case of those who worked in the real economy, to the payment of taxes which were deferred when income was invested into their pension fund.Yes.
Income tax payers is a much larger number than workers.
Thousands of pensioners don't work, but are income tax payers.
Can probably be measured in hundreds of thousands.Thousands of pensioners don't work, but are income tax payers.
It actually ‘costs’ them less than nothing when this happens.
If gross wages increase by 4.5% and you index the entire tax system at 4.5% the end result is:
1. Government receives 4.5% more in income tax
2. Your net pay increases 4.5%.
3. Your ‘effective tax rate’ stays the same
But for tactical reasons the government bank upfront more than the 4.5% extra they ‘should’ by assuming no change in tax bands (essentially assuming they will increase the effective tax on the population as a whole)…and then they position the indexing as a return to the taxpayer with an associated ‘cost’.