Will the government raid people's pension funds again for COVID-19 and can anything be done to stop them?

[Purple]

Depends. Very few universal benefits but I agree with your sentiment about child benefit. However it’s the cost of the program in general that’s the problem. It’s a political choice to have universality but it’s not a given that in the absence of it, the cost decreases.

Tax it at the marginal rate. That way people on low incomes get more. Maybe increase it a little then tax it.

Universality is a tool to level society in many different areas. Paradoxically, the “unfairness” of universal child benefit, is not actually unfair in that the costs are paid according to your proportional tax contribution. If the size of the program is too large by design that’s a spending issue rather than a universality issue I.e. regardless of the cost of the program, it will still be paid in the same proportion by everyone.

Taxing people then giving them their money back is wasteful. All it does is create a totally unnecessary bureaucracy and cost for the State and takes resources from where they would be better spent.

 

[NoRegretsCoyote]

A married couple with two children on a combined income of €80,000 will pay about €16500 in total payroll taxes and social insurance (€11,000 in income tax with the balance in USC and PRSI). They will receive €3,360 in children's allowance for a net contribution of a little over €13,000. That's to pay for their children's education, health services etc.

We can all pick arbitrary examples to suit our argument.

Here is an OECD chart on average tax and social security contributions made by a single worker at average earnings. Ireland is bang on average for the developed world.

Do you really think that a net tax contribution of 16.5% on an income of €80,000 is high?.
Their counterparts in Sweden will pay 32% of their income in taxes and social insurance.

Sweden has higher income taxes but better public services. That's a policy choice.

Indirect taxes in Ireland are also in comparative terms quite high.

 

[Purple]

We can all pick arbitrary examples to suit our argument.

Here is an OECD chart on average tax and social security contributions made by a single worker at average earnings. Ireland is bang on average for the developed world.

Single people in Ireland pay a higher proportion of their income in tax but married people with children, the ones who think they are the squeezed middle, who want free childcare and more handouts, pay bugger all. By the way I've 4 children so I'm part of that group.

Sweden has higher income taxes but better public services. That's a policy choice.

Yes, and they fund it with a much broader and fairer taxation system which doesn't rely on taxing a small group disproportionately. Our tax system is based as much on begrudgery as sound social planning. Sweden spends less than us on healthcare and significantly more on overall social spending. The real difference is that their spending offers value for money.

Indirect taxes in Ireland are also in comparative terms quite high.

How so? No property tax worth talking about, no water charges, 37% of working people not paying any income tax and probably well over 70% not paying any income tax when social transfers are taken into account.

 

[NoRegretsCoyote]

@Purple indirect taxes are not income taxes. They are taxes like VAT, VRT and excise. Ireland has (almost) the most expensive alcohol and cigarettes in the EU. The standard VAT rate of 23% is at the high end too.

Poor people pay very little income tax in Ireland but they pay a fair amount of indirect tax, especially as they tend to smoke and drink more as share of income.

 

[Purple]

@Purple indirect taxes are not income taxes. They are taxes like VAT, VRT and excise. Ireland has (almost) the most expensive alcohol and cigarettes in the EU. The standard VAT rate of 23% is at the high end too.

Poor people pay very little income tax in Ireland but they pay a fair amount of indirect tax, especially as they tend to smoke and drink more as share of income.

Yea, the smoking and drinking argument iss nonsense; if you can't afford to smoke or drink then don't smoke or drink. High taxes on discretionary items are not the same as a broad tax base. High taxes on petrol and cars does impact poor people more but that must be counterbalanced by our very high rates of long term welfare payments.
The VAT rate on food is zero and 13.5% on most other essentials.

 

[NoRegretsCoyote]

@Purple

You'r switching from positive to normative and back again. You think poor people shouldn't drink or smoke because they can't afford to. The fact is that (on average) they do, and they pay plenty indirect taxes as a result.

 

[Purple]

@Purple

You'r switching from positive to normative and back again. You think poor people shouldn't drink or smoke because they can't afford to. The fact is that (on average) they do, and they pay plenty indirect taxes as a result.

I think people who can't afford discretionary items shouldn't buy those items. That includes cars and houses.

I also think that people on high incomes shouldn't get social welfare payments.

But let's get back on topic; will the government raid personal pension funds again? Do remember that the last time they raided them they used the money to bail out the pension funds (bondholders) and put the money back into the same people's bank accounts so it wasn't that much of a net take, as it were.

 

[inflation]

But let's get back on topic; will the government raid personal pension funds again? Do remember that the last time they raided them they used the money to bail out the pension funds (bondholders) and put the money back into the same people's bank accounts so it wasn't that much of a net take, as it were.

Not so sure about that, at the time it was stated it was finding the VAT reduction for the hospitality sector.