What is the squeezed middle?

If we are quoting definitions, I find this line from Wikipedia quite close to what I thing you really believe, i.e. that it's a pity we don't live in a communist country:

The term "utopian socialism" was introduced by Karl Marx and Friedrich Engels in The Communist Manifesto in 1848

https://en.wikipedia.org/wiki/Utopian_socialism
 
So how come the tax base keeps getting narrowed and the burden keeps being placed more and more on high earners, more than any other country in the developed world?
 
Purple said:
So how come the tax base keeps getting narrowed and the burden keeps being placed more and more on high earners, more than any other country in the developed world?
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You know, it's very easy to get bogged down in percentages and the like. I quite like the simplicity of Deloitte's income tax calculator.

A single person earning 100k (which is good going to be fair, but takes a lot of work to get there) will pay almost exactly 40k a year in tax. 40 grand in tax!!!
 

Thats waaaayyyyy!!! over my head, I just want people to be happy!
 

a hand wringer who likes to keep his options open
 
Purple said:
So how come the tax base keeps getting narrowed and the burden keeps being placed more and more on high earners, more than any other country in the developed world?
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well i was referring to the very very wealthy who always have the ear of power , in my mind ,a hospital consultant earning 200 k per year could very well be in the " squeezed middle " , he or she will be paying an enormous amount of tax yet is unlikely to be asset rich or even able to build much in the way of wealth due to the huge tax burden placed upon him or her , the squeezed middle make up the majority but the majority ( silent majority ) in ireland are largely ignored , the media love the hard luck stories as well as the water charge protests , the majority of the squeezed middle havent time to attend anti water charges protests , our media is outrageously left wing relative to where the bulk of the electorate reside , thus a hugely disproportionate level of attention is paid to various anarchist or way out there radical views

the working stiffs ( beit factory worker on 35 k or senior engineer on 90 k ) are seen as boring and not worth listening to , there is also the situation where only one party ( FG ) is in anyway dedicated to pushing a narrative that work and effort is a worthy goal and not just in terms of monetary outcome , FF are as happy taking votes from someone who never made the slightest attempt to improve their lot as someone who worked through college and now puts in fifty hours per week plus , at least the left are sincere in their view , FF believe in absolutely nothing bar what will get them into power , thus its very difficult to have proper leadership , FF have shifted very very sharply to the left since michael martin took over so the likes of FG cant really do anything but engage in rank populism in order to keep the show on the road in some kind of semi functional way
 
TheBigShort said:
So would I be right in saying that someone on €33,800pa pays the same amount of tax as someone on say, €150,000pa, pays on the first €33,800 of their income?
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No. Because of the way Revenue operates spreading across the year, when the person on 150K has earned 33.8K cumulatively in a year, they will have paid more tax than a person on 33.8K will pay in the full year.

To make the calculations easier, look at someone on 6 times 33,800 = 202,800. By the end of February, they will have earned 33,600 and paid 15,490 in tax (46% of their salary). The person on 33,800 will pay 5,905 tax in the whole year (18% of their salary).
 
TheBigShort said:
So would I be right in saying that someone on €33,800pa pays the same amount of tax as someone on say, €150,000pa, pays on the first €33,800 of their income?
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Both will pay €6,760 in tax at the 20% rate on the first 33,800 they earn. It's after 33,800 that the higher earner gets walloped... 26,480 at the higher rate, 4 grand in PRSI and wait for it.....just over 5 grand in USC!
 

Yeh, we have it figured that higher earners pay a higher proportion of tax than lower earners. The question is, is it fair?
What you have outlined is nothing more than a levelling of income throughout the year to avoid being hammered after the cut off points.
 
Firefly said:
Both will pay €6,760 in tax at the 20% rate on the first 33,800 they earn. It's after 33,800 that the higher earner gets walloped... 26,480 at the higher rate, 4 grand in PRSI and wait for it.....just over 5 grand in USC!
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But the lower doesn't get walloped, because he doesnt earn that income.
So the question is, which would you prefer, an income of €33,800 and not get walloped or €33,800+any amount thereafter, but have to pay a higher tax?
 
TheBigShort said:
But the lower doesn't get walloped, because he doesnt earn that income.
So the question is, which would you prefer, an income of €33,800 and not get walloped or €33,800+any amount thereafter, but have to pay a higher tax?
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What's your point?
Should people who are good at their job and work hard be grateful that the state takes half of what they earn because hey, if they hadn't bothered their This post will be deleted if not edited to remove bad language working hard and acquiring those skills, often at great personal expense and personal sacrifice, they wouldn't earn as much?!

Sure be grateful you have have it to have it taken from you. Is that it?
 

I asked a question. The question was which would you prefer?
I dont disagree that taxes are too high on income, I pay them myself. I just disagree with the notion being peddled here on this site, in not one, but at least two threads now, that lower income earners need to start paying more tax in order to facilitate a tax reduction for higher earners.
So which would you prefer?
I think corporation tax is the elephant in the room, that needs to be tackled. We have been peddled the 12.5% rate for years, but the effective rate is somewhere between 0.05% and 4%.
Yet, in a site that is apparently about money, this gets very little attention.
 
We should gradually reduce taxes on high earners, or else, extend them more benefits. For the latter to be realistic, we (all taxpayers) would have to get better value for money back out of the public sector that we are getting today.
Irish high earners pay comparable taxes to those in other EU countries. There is no comparison in terms of what they get in return.
Irish high earners get a raw deal compared to those in other OECD countries.
And they know it. They respond by emigrating, or working \ earning less - why push yourself if the state is going to take more than half of every extra euro earned?

We might get a virtuous rebound from the laffer curve, in that by reducing taxes on high earners, suddenly we will discover a lot more of them
- from people working more because they keep more of their earnings
- from highly skilled people staying here rather than emigtrating
- from highly skilled people coming here to work because our high tech sectors are now more competitive at a european or global level

I think corporation tax is a discussion for another day. The 0.05% is a mirage being propagated by the EU commission, if we tried to reach for the billions of overseas earnings that the 0.05% is based on, it would vanish into thin air.
 
Nonsense, we are one of the few countries in the world where the effective tax rate for top companies is close to the nominal tax rate. Should we do what France does and have a nominal rate of 33.3% but an effective rate of 7.4%? Or Belgium with a nominal rate of 34% but an effective rate of just 6.5%? Maybe with a nominal rate of 12.5% and an effective rate of around 12% we are the only honest one in the room.

Lower income earners should pay more tax because it's the right thing to do.

Personally I would not reduce any taxes and I'd cut spending by a small amount in order to reduce debt, build up reserves and stop the economy over heating. I realise that there is a political imperative to appease the economically illiterate squeezed and most vulnerable masses and to keep the populists FF and the loony left out of power as they will be far worse than what we have now.
 

Im not doubting what you are saying. All this does is expose the blatant disregard of working people who generate the economic activity, get taxed for it, in order to fawn at feet of the corporate shareholders. Sure they pay what 30%? on profits, but those profits are enormously boosted by these extremely low corporate tax rates.
It has nothing to do with economic illiteracy, and everything to do with economic policy.
If you want a fair tax system, for all, then this can of worms needs to be opened.
 
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