Time to Tax the Rich

ZYX

So why not. Lets tax the rich. Lets tax those with most disposable income. Make them pay. Just have to find out who they are.

Example 1. Single person earning €35,000 a year with no special allowances has a take home pay of €2596 a month.

Example 2: Public sector worker earning €105,000 a year in Dec 2009 and supporting a family also no special allowances, has take home pay of €4777.

So clearly the person on €35,000 has the greatest take home pay person (even if you exclude the children)

So lets tax the rich. Young single people.

faceman

I hate suggestions of blanket taxes regardless of who they are targetting at. Just because on paper someone has a higher disposal income does not necessary mean they have more disposable cash. Their mortgage could be high, car loans etc just like everyone else.

Also if you tax high earning entrepreneurs to hard, they will just pack their stuff and move to another country or give up investing in Ireland.

Im not saying we tax those on lower income to compensate either.

however on re-reading your post, im not sure my comment is relevent. You has confused me!

Riskymove

the tax base does need attention in this country (e.g. half of the workforce do not pay income tax at all etc)

however, starting from a point of view of "lets get them folks over there" is not a very constructive approach

ZYX

Everyday on this site someone says "why aren't the government making the rich pay more" or some such words. The problem is it is very hard to say who the rich are.

I am guessing that the majority of people on this site are single and would earn about €35,000 a year. They of course do not consider themselves well off and demand cuts for everyone else. I am trying to point out that they might actually be wealthier than someone earning three times their income.

Barracudaincork

So you suggest you tax on someone on their disposible income?

The issue with tax is that there is no fool proof way of making it fair for everyone, there are many suggestions on how to reform the tax systems including the height tax, but no sure fire way has arisen yet.

kippy

ZYX wrote: »

Everyday on this site someone says "why aren't the government making the rich pay more" or some such words. The problem is it is very hard to say who the rich are.

I am guessing that the majority of people on this site are single and would earn about €35,000 a year. They of course do not consider themselves well off and demand cuts for everyone else. I am trying to point out that they might actually be wealthier than someone earning three times their income.

How are you measuring wealth?

Of course, a guy earning 100k, who has a 2k per month mortgage, healthcare of 3 grand a year for his family of two, tax, PRSI, Pension contributions, car/home/life insurance/car tax/fuel/oil/food/clothes costs will probably have less disposable income than a guy on 30K a year living with his parents.
I dont get the point though.............

ZYX

Barracudaincork wrote: »

So you suggest you tax on someone on their disposible income?

The issue with tax is that there is no fool proof way of making it fair for everyone, there are many suggestions on how to reform the tax systems including the height tax, but no sure fire way has arisen yet.

Well concentrate tax changes on the lower rate. That would increase tax for everyone. Reduce the exemption limits. Remove the system of individualisation as at present a family earning 70K can take home more than a family earning 120,000.

ei.sdraob

ZYX wrote: »

So lets tax the rich. Young single people.

go ahead and watch the young and single (no family tying them down) leave for greener pastures abroad

oh and kiss goodbye to them money spend educating these people (in majority of cases) to 3rd level standard

ZYX

kippy wrote: »

How are you measuring wealth?

Of course, a guy earning 100k, who has a 2k per month mortgage, healthcare of 3 grand a year for his family of two, tax, PRSI, Pension contributions, car/home/life insurance/car tax/fuel/oil/food/clothes costs will probably have less disposable income than a guy on 30K a year living with his parents.
I dont get the point though.............

One person earns 35K. Takes home 2596 a month to support 1 person.
Family earn 105k take home 4777 to support 2 adults and children. I am not counting mortgages or anything else

ei.sdraob

ZYX wrote: »

One person earns 35K. Takes home 2596 a month to support 1 person.
Family earn 105k take home 4777 to support 2 adults and children. I am not counting mortgages or anything else

who will perform these calculations and taxation collections? Revenue??


last i checked the public sector workers are striking/working to rule already

god forbid you suggest more work is added to the existing lot :eek:

BrownianMotion

Your examples are set up to suggest that we should overtax young people on an average wage in order to undertax the six figure wage of a public servant. Plus the take home pay figure for €35,000 is incorrectly high.

Given how many public/private mud-slinging matches appear here I think if this was a serious suggestion rather than an attempt to start another argument you would have used different examples.

Are you a journalist for the Irish Independent by any chance?

ixoy

You need to take into account other factors though. For example, many of the young people on this 35k would, if they've bought, had to by during the boom and thus would have higher mortages. Conversely, if you're on 6 figures, you've been earning longer and would more likely to have bought earlier.

You're also removing any incentive for young people to work here and, of course, withdrawing money from the economy in the end.

Riskymove

ZYX wrote: »

Everyday on this site someone says "why aren't the government making the rich pay more" or some such words. The problem is it is very hard to say who the rich are.

I am guessing people dont always mean well-salaried people when they talk about the rich..certainly I dont...the guy on 107k that you are talking about is one of those basically paying most of the income tax in this country, i would not necessarily call him "rich" given the costs in this country...obviously I wouldn't call him poor either

I have in mind the beneficiaries of all the wealth which was generated over the boom, a lot of that money is still out there...generated by tax-breaks, property bubble etc

Nidot

I think earnings need to be evaluated on the basis of ability. The amount you earn gross is directly linked to your ability in a role and the demand for your skills in this role.

The amount you take home net is based on your personal circumstances. This means that a person with more needs (i.e. children, mortgage etc) receive tax allowances to help them with these expenses.

If people look at it on the basis of tax allowances offered then single people with no allowances is subsidising the married person with 3 dependents.

If it was the case that we paid people on their needs rather than their ability this would be foolish as it would mean someone could earn more money just by having more kids.

As it stands having tax reliefs for dependents, carers, mortgage interest relief, we already tax the rich so as others (i.e. those who's needs dictate they need increased earnings - kids, mortgage, dependents) can avail of these reliefs/allowances. People need to realise where the money comes from to allow the governement to offer these reliefs.

kippy

I recommend closure of this post before it gets stupid.

It seems to advocate taxing disposable income (which when you think about it is already taxed in the form of VAT/Excise already/DIRT already)

Nidot

kippy wrote: »

I recommend closure of this post before it gets stupid.

It seems to advocate taxing disposable income (which when you think about it is already taxed in the form of VAT/Excise already/DIRT already)

Agreed its definitely a rediculous posting

Riskymove

ei.sdraob wrote: »

who will perform these calculations and taxation collections? Revenue??

last i checked the public sector workers are striking/working to rule already

god forbid you suggest more work is added to the existing lot :eek:

come on, we don't need to turn EVERY thread into a public/private bashing contest

Your examples are set up to suggest that we should overtax young people on an average wage in order to undertax the six figure wage of a public servant. Plus the take home pay figure for €35,000 is incorrectly high.

the public/private tags would be irrelevant from a tax point fo view

BrownianMotion

Riskymove wrote: »

come on, we don't need to turn EVERY thread into a public/private bashing contest



the public/private tags would be irrelevant from a tax point fo view

Agreed, but they were the examples that were included in the original post as bait, which people are already biting.

kippy

ZYX wrote: »

One person earns 35K. Takes home 2596 a month to support 1 person.
Family earn 105k take home 4777 to support 2 adults and children. I am not counting mortgages or anything else

You're figures are incorrect anyway:
Single on 35k takes home: 2367
Married person (public sector and assumeing he DOESNT transfer his unworking wifes tax credits to himself, which they should) with 2 kids: 4777 (I think if the credits were transfered this would be much higher.......

Riskymove

BrownianMotion wrote: »

Agreed, but they were the examples that were included in the original post as bait, which people are already biting.

well as I say they are irrelevant from a tax point of view, private and public pay same tax

Barracudaincork

ZYX wrote: »

Well concentrate tax changes on the lower rate. That would increase tax for everyone. Reduce the exemption limits. Remove the system of individualisation as at present a family earning 70K can take home more than a family earning 120,000.

How? Can you show me how you calculate that?

BrownianMotion

Riskymove wrote: »

well as I say they are irrelevant from a tax point of view, private and public pay same tax

Yes I know that, that's why I said agreed. My point which you are missing is that this guy is just attempting to start an argument by posting a ridiculous suggestion in the form of pitting a public sector worker v a private sector worker.

Riskymove

BrownianMotion wrote: »

Yes I know that, that's why I said agreed. My point which you are missing is that this guy is just attempting to start an argument by posting a ridiculous suggestion in the form of pitting a public sector worker v a private sector worker.

I realise that :pac:

now you are missing my point that we should just ignore the public/private tags in his example and debate/discuss/ridicule his suggestion without resorting to taking the bait and bashing private/public

ZYX

Nidot wrote: »

I think earnings need to be evaluated on the basis of ability. The amount you earn gross is directly linked to your ability in a role and the demand for your skills in this role.

The amount you take home net is based on your personal circumstances. This means that a person with more needs (i.e. children, mortgage etc) receive tax allowances to help them with these expenses.

I agree totally

Nidot wrote: »

If people look at it on the basis of tax allowances offered then single people with no allowances is subsidising the married person with 3 dependents.

How?


The figures I used came from www.taxcalc.eu

As I have said people constantly say public sector workers should face up to the economic realities and take their pay cuts. I agree with this and I am not public sector. However tax payers also have to face up to their responsibilities and face tax rises. Most people here seem to aggree with this but constantly say tax people over 100,000 (obviously saying this group should pay more is ok. Saying those earning 35K should pay more is divisive.)

Riskymove

ZYX wrote: »

How?

the person on 35 has no allowances = paying all tax he should be

other person gets tax reliefs, therefore he is being subsidised

ZYX

Riskymove wrote: »

the person on 35 has no allowances = paying all tax he should be

other person gets tax reliefs, therefore he is being subsidised

And the allowances are worth How Much?

Riskymove

ZYX wrote: »

As I have said people constantly say public sector workers should face up to the economic realities and take their pay cuts. I agree with this and I am not public sector. However tax payers also have to face up to their responsibilities and face tax rises. Most people here seem to aggree with this but constantly say tax people over 100,000 (obviously saying this group should pay more is ok. Saying those earning 35K should pay more is divisive.)

the bottom line is that no-one is forcing anyone to have a mortgage, a spouse or kids to support, there are choices to be made

frankly being on €100k would give you far more financial freedom to do this than being on €35

on your logic a single person earning €100k should be absolutely crucified!

BrownianMotion

Riskymove wrote: »

I realise that :pac:

now you are missing my point that we should just ignore the public/private tags in his example and debate/discuss/ridicule his suggestion without resorting to taking the bait and bashing private/public

Haha apologies I didn't really look at it from the point of view that it was a genuinely serious suggestion.:eek:

kippy

ZYX wrote: »

I agree totally



How?


The figures I used came from www.taxcalc.eu

As I have said people constantly say public sector workers should face up to the economic realities and take their pay cuts. I agree with this and I am not public sector. However tax payers also have to face up to their responsibilities and face tax rises. Most people here seem to aggree with this but constantly say tax people over 100,000 (obviously saying this group should pay more is ok. Saying those earning 35K should pay more is divisive.)

Again, recheck your figures. The single persons take home is incorrect and the married person is not transferring unused tax credits. If that is the basis for the argument its pretty poor. The married person is taking at least 2.2k more a month home........ to pay for his family.
Not THAT many people her are advocating further taxation of the rich or anyone for that matter. Just a review and broadening of the tax bracket followed by a review of minimum wage, social welfare and further reviews of Public sector pay.

I dont particularily want to pay any more tax than I currently am, nor do a particularily want to have to take any more cuts (pension levey and recent pay cut were enough).
I've already cut my spend based on my income levels dropping and that in itself multiplied by all those other people in the same position is bad for part of the economy. The knock on effects of paycuts/higher taxation are very very negative. While I know paycuts are needed in the PS, we whould now begin to concentrate on streamlineing of operations etc and look towards creating more private sector jobs through whatever means are available to us.
Completly off the topic of this thread but I feel the thread isnt that on topic anyway.

Sleepy

The tax base needs to be looked at significantly alright.

Personally, I'd be of the opinion that almost everyone working should be contributing something so would lower the personal tax credits to ensure that everyone is hit for some amount of tax. If you're working part-time, you should only be receiving part of your tax credits.

Taxes on the transfer of assets between generations should be raised and simplified (i.e. remove lots of the loopholes). Very much a personal opinion but I believe a society which encourages each generation to fend for itself rather than live off the labours of their forebears will ultimately be both more equitable and productive.

Remove pretty much every loophole and tax avoidance scheme in existance. We waste more money in foregone taxes and direct support of horse-racing than we spend on every other sport combined. This is madness. I'm all for tax breaks for things like R&D or measures than encourage entrepeneurial (rather than speculative) behaviour but I believe our taxation system is in need of such a radical overhaul in this regard we're probably best starting from a point of having no breaks and then identifying areas where we can use measured, targeted tax breaks.

Oh, and if it's not already taxed, employer pension contributions should be considered taxable income.

Riskymove

ZYX wrote: »

And the allowances are worth How Much?

it would depend on exact circumstances

well, you'd pay less of your tax at the higher rate for a start

plus a higher tax credit I think

you could also get mortgage interest relief if eleigible

ZYX

Riskymove wrote: »

the bottom line is that no-one is forcing anyone to have a mortgage, a spouse or kids to support, there are choices to be made

frankly being on €100k would give you far more financial freedom to do this than being on €35

on your logic a single person earning €100k should be absolutely crucified!

No one is talking about mortgages and no allowance covers the gap.

I fully appreciate that it is very hard to take personal circumstances into account. A simple increase in basic rate of tax would seem to be the fairest way. It affects everyone. The thing is when people come on here and say ridiculous things like "tax everyone over 100k at 60%" or other such nonsense why don't the same people who are complaining about this thread complain about that.

Riskymove

ZYX wrote: »

I fully appreciate that it is very hard to take personal circumstances into account. A simple increase in basic rate of tax would seem to be the fairest way. It affects everyone.

but the guy on €100k would pay more then too

The thing is when people come on here and say ridiculous things like "tax everyone over 100k at 60%" or other such nonsense why don't the same people who are complaining about this thread complain about that.

well obviously on one level, as you suggest, there would be more people on boards earning around €35k or less than there are over €100k

on another level, what you originally suggested, a kind of system to tax people based on disposable income is pretty outlandish; far more so than any suggestion to introduce a higher tax rate for high earners

A simple increase in basic rate of tax would seem to be the fairest way

actually there is a growing body of work about "optimal tax" which advocates one single tax rate without any allowances for everyone as being "fair"

Excaptain

kippy wrote: »

I recommend closure of this post before it gets stupid.

It seems to advocate taxing disposable income (which when you think about it is already taxed in the form of VAT/Excise already/DIRT already)

Agreed. I have read post #14 about 5 times and unless I'm thick I miss the point completely.

ZYX

Riskymove wrote: »

but the guy on €100k would pay more then too

but it would be fairer.

Riskymove wrote: »

well obviously on one level, as you suggest, there would be more people on boards earning around €35k or less than there are over €100k

on another level, what you originally suggested, a kind of system to tax people based on disposable income is pretty outlandish; far more so than any suggestion to introduce a higher tax rate for high earners

I never said tax disposable income. I said if we want to tax the rich we need to decide who is rich.

ei.sdraob

Riskymove wrote: »

come on, we don't need to turn EVERY thread into a public/private bashing contest

that wasnt the intent, was pointing out an obvious flaw in this plan

Riskymove

I never said tax disposable income

ZYX wrote: »

Lets tax those with most disposable income.

ahem?

ei.sdraob: that wasnt the intent, was pointing out an obvious flaw in this plan

I think we can all see what your intent was

ZYX

ei.sdraob wrote: »

that wasnt the intent, was pointing out an obvious flaw in this plan

The problem was caused mainly by Charlie McCreevy in one budget ie individualisation of tax system. It could easily be changed and may well reduce the current unemployment rate.

Tipp Man

Isn't it obvious to everyone that we need to broaden the tax take and actually have more people contributing a sustainable amount??

Far too many people in this country not paying tax at all, its take take take for too many

ZYX

Riskymove wrote: »

ahem?

But you don't tax the disposable income. You change the allowances that people seem to think exist. There are minimal allowances so increase these. As I said scrap individualisation of tax system.

Barracudaincork

Was the link to Taxcalc meant to be the answer? If so i used that link and a family earning 70K gets an annual tax home pay of €50,488 and a family earning 120K gets €75,339. Why is the family earning 70K better off?

kippy

Barracudaincork wrote: »

Was the link to Taxcalc meant to be the answer? If so i used that link and a family earning 70K gets an annual tax home pay of €50,488 and a family earning 120K gets €75,339. Why is the family earning 70K better off?

They are not.........they are taking home 25K less.........

Riskymove

ZYX wrote: »

As I said scrap individualisation of tax system.

that is not magically going to sort out the problems with our tax take/ tax base

what benefit exactly do you see from that?

Barracudaincork

kippy wrote: »

They are not.........they are taking home 25K less.........

I know but ZYX said that the person earning 70K is better off and for the life of me, i cant work out why!

Excaptain

Tipp Man wrote: »

Isn't it obvious to everyone that we need to broaden the tax take and actually have more people contributing a sustainable amount??

Far too many people in this country not paying tax at all, its take take take for too many

Fair play Tipp Man, alas someone is making sense.

I hate this BS that everyone spouts out all the time of hit the rich, they can afford it blah, blah, blah. That may be true but folk forget that it was these people's entrepreneurship that created a lot of jobs in this country and as a result contributed to the overall tax take in the country. People like Denis O'Brien get such bad publicity because they are tax exiles. Why are we a nation of begrudgers? If people have earned their millions fair play, let them enjoy it. Everyone has to pay a share, end of.

ZYX

Barracudaincork wrote: »

Was the link to Taxcalc meant to be the answer? If so i used that link and a family earning 70K gets an annual tax home pay of €50,488 and a family earning 120K gets €75,339. Why is the family earning 70K better off?

Yes, sorry I got confused with my public and private incomes. Sorry about that.

Yes the couple earning €35000 each would take home €56849 and the couple earning €120,000 from one worker would take home €75,339 a difference of €18500.(despite earning 50K more)

Sorry.

P. Breathnach

I think that in the medium term we need an increase in taxation to compensate for the drop in exchequer revenue from stamp duty on property taxes, from VAT on building and on high living, and from VRT.

ZYX's original post is a challenge: to identify how we might broaden the tax base with minimum social injustice. What is fresh about it is that there isn't a simplistic assumption that it is solely a matter of income level -- that a fair tax system should take proper account of the taxpayer's circumstances. Of course there is room to argue about the weight to be given to various things.

Some of the responses look to me like self-interest dressed up as high principle.

Barracudaincork

ZYX wrote: »

Yes, sorry I got confused with my public and private incomes. Sorry about that.

Yes the couple earning €35000 each would take home €56849 and the couple earning €120,000 from one worker would take home €75,339 a difference of €18500.(despite earning 50K more)

Sorry.

But you said the family earning 70K earns more, they dont by your calculation here again, they earn 18,500 less. And why arent you comparing like with like, ie both families either have two or one incomes?

Riskymove

Barracudaincork wrote: »

But you said the family earning 70K earns more, they dont by your calculation here again, they earn 18,500 less. And why arent you comparing like with like, ie both families either have two or one incomes?

it seems that he is talking about individualisation, although he doesn't really make that clear in his OP

I think he also calculated the net income for a public worker which presumably includes the levy

ei.sdraob

the thing that OP is missing

is that single young people already pay more taxes and less benefits/credits than a married couple with kids would get lets say

so how to square that circle?

ZYX

Barracudaincork wrote: »

But you said the family earning 70K earns more, they dont by your calculation here again, they earn 18,500 less.

I know that is why I said sorry. 3 times. Sorry again.

Barracudaincork wrote: »

And why arent you comparing like with like, ie both families either have two or one incomes?

Because I was showing how people are taxed differently. That you cannot simply say "they earn over 100K so they can pay more".