"We are the only OECD state where some get back more than they pay in income tax"

[Purple]

Eh, how do you usurp the right of the people through parliament??

Social Partnership was a good example.

I have no issue with anybody or any grouping lobbying politicians for their interests or issues to be addressed, as long as that lobbying is transparent to the public.
If you are following the public pay talks you can see the demands by ICTU and you can see the demands of DPER representing the State. You can also drill down into individual unions to see any particular demand specific to that union.
I have no issue with billionaires lobbying for their own interests, as long as those interests are transparent to the public.
The government will decide it's interests on behalf of the State and the voters can decide their interests at the ballot box.

Do you really believe that lobbying, by Unions and others, is transparent to the public?!
Billionaires who can fund a Party or Unions which can break one. Do you really think that Party in government will act in the broader national interest with a gun to their head or a pot of gold on the table?

 

[Firefly]

In fairness to TheBigShort he answers questions and offers opinions which is more than ca be said for some posters who only cross-examine and question other posters comments. He's also fighting on multiple fronts at the moment

That's true and he's not added you to his "ignore list" either

 

[Purple]

That's true and he's not added you to his "ignore list" either

Yet

 

[Duke of Marmalade]

Is there much evidence of this? I would suggest that it would, in time, have a massively positive impact.

It is more subtle than the nominal redistribution of money, albeit that too would be small. What matters is transfer of economic output i.e. goods and services. Taxing incomes in excess of €2m would have a negligible effect on those folks consumption. Redistributing the super tax will not do anything to increase output (assuming economy at full output) so it will not increase the share of output of the rest, it will merely increase prices.

ONTH taking an extra €8k from someone earning €200k would have redistributive effects. For example they might cut back on their private health insurance thus freeing up health services for others i.e. a redistribution of health resources.

 

[Purple]

ONTH taking an extra €8k from someone earning €200k would have redistributive effects. For example they might cut back on their private health insurance thus freeing up health services for others i.e. a redistribution of health resources.

Hi Duke, I don't understand that point. If they cut back on their private health insurance that will put an additional burden on the tax payer as they will then consume publicly provided and funded health services rather than privately funded services.
They are currently funding the cost of providing public healthcare through their taxes but choosing not to consume it. If they get rid of their private cover they are no longer paying for it twice.

 

[Duke of Marmalade]

Hi Duke, I don't understand that point. If they cut back on their private health insurance that will put an additional burden on the tax payer as they will then consume publicly provided and funded health services rather than privately funded services.
They are currently funding the cost of providing public healthcare through their taxes but choosing not to consume it. If they get rid of their private cover they are no longer paying for it twice.

Take your point. Bad example as they are effectively paying on the double so if they cut that back it would have a perverse counter redistributive effect.

The basic point though is that redistribution only means anything if it refers to goods and services. Money, taxation etc. are only means to that end. So maybe a better example is housing. The €200k guy will have reduced spending power in the housing market and the benefactors on lower incomes will have increased spending power thus creating redistributitive effects in housing.

 

[Firefly]

The basic point though is that redistribution only means anything if it refers to goods and services. Money, taxation etc. are only means to that end. So maybe a better example is housing. The €200k guy will have reduced spending power in the housing market and the benefactors on lower incomes will have increased spending power thus creating redistributitive effects in housing.

Except that the 200k guy and those lower down may now be competing on the same house

 

[Duke of Marmalade]

Actually Purple I haven't given up on health services as an example, despite the distortions of the two tier system.

Let us simplify our assumptions as follows.

At a point in time there are a fixed amount of health services available and at a fixed price.

The person with private health insurance certainly gets a better service in terms of waiting times for elective procedures. They may be paying through the nose or on the double but they clearly think it's worth it.

Take €8k off them and many will change that assessment and reduce their cover or go public altogether. So less people with preference in the queue and so lower waiting times for the rest. In other words a redistribution of the available health services.

Getting back to >€2m p.a. woman, imposing a super tax on her will not impact her spending on health insurance one iota, indeed she probably self insures.

 

[Purple]

Take €8k off them and many will change that assessment and reduce their cover or go public altogether. So less people with preference in the queue and so lower waiting times for the rest. In other words a redistribution of the available health services.

If nobody had private health insurance there would be no private hospitals and so less healthcare capacity available in the State. Therefore more people will be in the public hospital queue; the State would have to spend more money on healthcare.
Private health insurance is, in effect, a subsidy on the public healthcare system.

 

[Firefly]

Getting back to >€2m p.a. woman, imposing a super tax on her will not impact her spending on health insurance one iota, indeed she probably self insures.

Interesting point. I'm curious as to what people think the break-even point would be for say a 40 year-old in good health. How much money could be put into a bank account to meet the need for "going private" without paying the VHI/LAYA/Others. I'll start a thread....

 

[Duke of Marmalade]

If nobody had private health insurance there would be no private hospitals and so less healthcare capacity available in the State. Therefore more people will be in the public hospital queue; the State would have to spend more money on healthcare.
Private health insurance is, in effect, a subsidy on the public healthcare system.

I think I'll drop the health insurance motif, too complicated As you point out the two tier system acts as a sort of progressive charge for healthcare, people in private insurance pay over the odds. So if a highly progressive income tax is imposed, it will be partially cancelled by the extent to which affected folk drop out of private health insurance.

Under my assumptions the healthcare resources are still there and society's capacity to pay for them in aggregate is still there so the status quo could be maintained from a macro economic point of view but it would need an increase in general taxation to pay for it.

 

[TheBigShort]

We're not talking about equality, we're talking about whether you support equality of outcome. You would tax (small) cohort of people to such an extent that they would have the same income. Using your figures, it would currently affect 300 people. Nothing stopping that 2m magic number from being reduced to bring more people in. This is equality of outcome and it's a pity you and the other socialist posters on here cannot admit it.

Legislation would be required for such a proposal. In my example 0.015% of the workforce would be directly affected. Arguably, not a penal amount. If greater numbers of worker's begin to get caught by such a proposal, then the €2m is raised to keep the number of worker's at 0.015%.
As stated the nuts and bolts needs to be scrutinized.
Furthermore, I would propose that any income limit would not be restricted to the year in question, but perhaps over a 7yr business cycle. For instance, if I earned €1m in 2010, €1.5m in 2011, €3m in 2012, then the unearned portion of incomes could be used to offset against the income limit. If I continuously earn €2m+ thereafter, I will eventually get caught.
But furthermore if I do get caught with the income limit, the 100% contribution will also be used in times in the future where perhaps I am only earning average income. For instance, if I ever paid income at 100% in the past and I now find myself earning an income of less than €2m. The 100% contribution made in previous years, can be used to offset against my tax liability due on my lower income. E.g. I have contributed €1m in 100% over last 7yrs. My business however goes bust and I have taken a €75,000 a year consultancy post. Typically I will pay 40% tax, but considering the €1m 100% I can now write off any tax liability for the next 7yrs.

 

[Firefly]

Legislation would be required for such a proposal. In my example 0.015% of the workforce would be directly affected. Arguably, not a penal amount. If greater numbers of worker's begin to get caught by such a proposal, then the €2m is raised to keep the number of worker's at 0.015%.
As stated the nuts and bolts needs to be scrutinized.
Furthermore, I would propose that any income limit would not be restricted to the year in question, but perhaps over a 7yr business cycle. For instance, if I earned €1m in 2010, €1.5m in 2011, €3m in 2012, then the unearned portion of incomes could be used to offset against the income limit. If I continuously earn €2m+ thereafter, I will eventually get caught.
But furthermore if I do get caught with the income limit, the 100% contribution will also be used in times in the future where perhaps I am only earning average income. For instance, if I ever paid income at 100% in the past and I now find myself earning an income of less than €2m. The 100% contribution made in previous years, can be used to offset against my tax liability due on my lower income. E.g. I have contributed €1m in 100% over last 7yrs. My business however goes bust and I have taken a €75,000 a year consultancy post. Typically I will pay 40% tax, but considering the €1m 100% I can now write off any tax liability for the next 7yrs.

It's a pity you didn't think of this a few pages back and it seems overly complicated to me. To be honest, it seems like you're squirming out of accepting your proposal is an equality of outcome measure, which it is.

 

[TheBigShort]

Are you suggesting that business owners will expand and take risks and employ more people and generate more tax revenue for the State if there is no financial gain for them?

In general no, but in general the financial gains you speak still fall way short of the €2m income limit. That is why there are only 300 odd people earning those sums.
To earn that much money is actually quite rare amongst the population. So overall, the income limit will not act as a deterrent.

Do you think that a person who is on the average wage has the same influence as someone worth billions?

No, but collectively, average income earners can exert influence.

Social Partnership was a good example.

All done through the mechanisms of the State.

Do you really believe that lobbying, by Unions and others, is transparent to the public?!

Broadly yes.

Billionaires who can fund a Party or Unions which can break one.

There are transparent rules to funding political parties.

That's true and he's not added you to his "ignore list" either

There is an "ignore list"??

 

[TheBigShort]

It's a pity you didn't think of this a few pages back

To be fair, I was asked a question about income limits, this was my answer.

the nuts and bolts of such a proposal would need in-depth scrutiny. But in essence it refers to the personal income of an individual as distinct personal wealth. There would be nothing stopping anyone from acquiring personal wealth greater than €2m, stocks, property, investments etc. What it would boil down to is effectively a €2m a year lifestyle

The proposal would need a thread of its own. There is nothing overtly complicated about. I think a similar 7yr business tax cycle exists for corporations, where losses in one year can be offset against profits a following year. Although I could be wrong on that.

I have stated that the purpose is not to gather more taxes, but rather to develop a social norm as to what is more than adequate for any individual to live on in this society. It equates to roughly 100 times the minimum wage.
Most of us, including me, would like to win the Euro millions jackpot. Most of us, I would suggest, accept that the jackpot can reach to levels of income beyond any rationality.

 

[Firefly]

I have stated that the purpose is not to gather more taxes, but rather to develop a social norm as to what is more than adequate for any individual to live on in this society. It equates to roughly 100 times the minimum wage.
Most of us, including me, would like to win the Euro millions jackpot. Most of us, I would suggest, accept that the jackpot can reach to levels of income beyond any rationality.

More fluff but I'm not surprised. You have proposed an equality of outcome measure, correct me if I am wrong.

 

[TheBigShort]

More fluff but I'm not surprised. You have proposed an equality of outcome measure, correct me if I am wrong.

You are corrected.

I sense you getting hung up on this like when thought I supported the Soviet Union, or when you thought I was xenophobic, or when you thought I was somehow discriminatory against young people.
I have already stated that your definition of equality of outcome obviously differs from mine. So perhaps you would like to define it?

 

[Firefly]

You are corrected.

I don't see how.

I have already stated that your definition of equality of outcome obviously differs from mine. So perhaps you would like to define it?

Incorrect again. You stated our definitions of equality are different, not equality of outcome. When you force even 2 people to have the same income you are applying an equality of outcome measure.

 

[Firefly]

Maybe we could get a better feel for your position if you could tell us which country, say in Europe, most approximates this objective at the present time. If it is your view that nowhere meets the objective then you should remove the phrase in bold from your statement.

@BigShort. Have you had time to think?

 

[TheBigShort]

@BigShort. Have you had time to think?

I responded to the comment way back on page 16.