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Tax net to catch low-pay workers

  • 06-06-2010 10:40AM
    #1
    Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭


    March 2010
    In the medium term, we should explore the potential of social insurance and local taxation to broaden the tax base while providing real benefits in return. PRSI can be expanded to incorporate a comprehensive free healthcare system (in particular, primary care) as well as earnings-related pensions. Stronger local taxation powers have the potential to be more accountable while providing investment in services responsive to local needs. On the expenditure side, it is time to make public sector workers partners in the process to increase productivity and efficiencies.

    .........

    Tony Moriarty and Michael Taft, Unite trade union.
    'All the wrong options have been pursued'

    June 2010
    Ireland's lower-paid workers are to be brought into the tax net from the end of the year, as part of Budget plans being considered by Finance Minister Brian Lenihan and his department, it has emerged.

    "The situation whereby 50 per cent of the workforce is outside the tax net can no longer continue. We have to widen the tax base," said one senior government minister this weekend.

    It has also been confirmed that two of the three big-budget departments -- Mary Harney's Department of Health and Tanaiste Mary Coughlan's Department of Education -- are to be most severely cut in December.
    Tax net to catch low-pay workers

    No benefits in return, poor private sector workers must pay more to prevent compulsory redundancies in public sector

    PS unions won again:mad:


«134567

Comments

  • Posts: 3,925 ✭✭✭ [Deleted User]


    I'm all for bringing everyone into the tax net, but it's pointless without massive reductions to Social Welfare benefits.

    Sickening that health and education will suffer so that PS wages and welfare benefits can remain sky-high..


  • Closed Accounts Posts: 6,281 ✭✭✭Ricky91t


    Rojomcdojo wrote: »
    I'm all for bringing everyone into the tax net, but it's pointless without massive reductions to Social Welfare benefits.

    Sickening that health and education will suffer so that PS wages and welfare benefits can remain sky-high..

    And what happens to the unfortunate people who have this as their only scource of income? They're just forgotten about?


  • Posts: 3,925 ✭✭✭ [Deleted User]


    They learn to live on what they have. With net income reductions comes deflation.


    I'm on the dole myself at the moment and I'm saving most of it. It's far too high and needs to be slashed. The difference between someone with all the benefits and someone working for a very low wage is FAR too small.

    Or do you think that it's correct?


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    if more people are paying taxes

    they might actually start to listen, care and act on the events happening in this country

    the "proles" :p are to politically apathetic and economically uninformed, this might change if it hits them directly in pockets


  • Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭Count Dooku


    Ricky91t wrote: »
    And what happens to the unfortunate people who have this as their only scource of income?
    It will mean that more people will prefer to have only this source of income


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  • Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭Count Dooku


    ei.sdraob wrote: »
    if more people are paying taxes

    they might actually start to listen, care and act on the events happening in this country

    the "proles" :p are to politically apathetic and economically uninformed, this might change if it hits them directly in pockets
    Do you mean that greed of PS unions will strike back and not only posters on boards.ie will look more carefully on public sector earnings?:rolleyes:


  • Closed Accounts Posts: 6,281 ✭✭✭Ricky91t


    Rojomcdojo wrote: »
    They learn to live on what they have. With net income reductions comes deflation.


    I'm on the dole myself at the moment and I'm saving most of it. It's far too high and needs to be slashed. The difference between someone with all the benefits and someone working for a very low wage is FAR too small.

    Or do you think that it's correct?

    I suppose it depends on if you have Children etc, I know a few single parents with Children over 18 in College, None have got jobs for the summer( You know how bad the situation can be in places ) and therefore both need to live off that small payment for the summer monthes, If that was to reduce I know it would be near impossible, I think it needs to be reviewed for certain situations and reduced in some.

    If it's a 22 year old, Living at home on the dole with parents both working then yes it should be reduced, But for other situations it shouldn't be. For people like you, Saving a majority of it show's there is a problem with the system but reducing it for everyone who receives it would only cause more problems.


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Do you mean that greed of PS unions will strike back and not only posters on boards.ie will look more carefully on public sector earnings?:rolleyes:

    hopefully more people would start asking "hard" questions about the situation the country is in

    and not only focus on the PS train carriage of the state gravy train


  • Registered Users, Registered Users 2 Posts: 13,104 ✭✭✭✭djpbarry


    Ricky91t wrote: »
    If it's a 22 year old, Living at home on the dole with parents both working then yes it should be reduced, But for other situations it shouldn't be. For people like you, Saving a majority of it show's there is a problem with the system but reducing it for everyone who receives it would only cause more problems.
    I think the point is that, in general, social welfare payments are too high. Obviously, there are exceptions, but that’s what means tests are supposed to be for. Having said that, my claim for Jobseeker’s Allowance was recently processed (the missus is still working and doing fairly well for herself) and I am absolutely astounded by how much I have been deemed eligible to claim. Like Rojomcdojo, I will be putting a sizeable chunk into a savings account every week – now that’s just not right, is it?


  • Registered Users, Registered Users 2 Posts: 4,121 ✭✭✭RichardAnd


    It has also been confirmed that two of the three big-budget departments -- Mary Harney's Department of Health and Tanaiste Mary Coughlan's Department of Education -- are to be most severely cut in December.


    Does anyone know just what is meant by this? Will it be admin jobs cuts or what?


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  • Moderators, Entertainment Moderators, Politics Moderators Posts: 14,568 Mod ✭✭✭✭johnnyskeleton


    As a basic premise, it is undenyable that spending must be cut, and taxes must be raised. I don't think even the most unrealistic commentator can deny that that is the realty, the question being how much spending to be cut, how much taxes to be raised, and where to make these changes.

    From the tax side, there are a number of principles:
    1) make sure that whatever increases in tax rates are made that it does not discourage the payment of tax i.e. any new or increased tax must lead to greater total revenue;
    2) make sure that whatever increases in tax rates do not discourage productivity i.e. if you tax minimum wage employees such that they would make more on the dole, then they are unlikely to work and the unemployed are unlikely to take a low paid job, equally if you increase corporation tax or tax on high earners too much they might leave the country.
    3) make sure that the taxation does not damage socially beneficial things e.g. don't tax charitable donations, don't disproportionately tax the lower paid.

    So any new tax should comply with the above prinicples, although sometimes a balance has to be made.

    Taxing the lower paid should be done so as to avoid:
    1) people working cash in hand instead of PAYE;
    2) basic social welfare payments should be reduced in line or greater than the tax will reduce wages by;
    3) a perception that the lower paid are unfairly targeted.

    This may not seem fair or nice, but it is a fairly sound basis to increase the tax base. If people were a bit more publically spirited (and I include myself in my lack of public spirit) they would look at tax increases from the point of view of whether it is good for the economy, not whether it is good for their own pockets.


  • Registered Users, Registered Users 2 Posts: 3,136 ✭✭✭Spudmonkey


    Ricky91t wrote: »
    If it's a 22 year old, Living at home on the dole with parents both working then yes it should be reduced, But for other situations it shouldn't be. For people like you, Saving a majority of it show's there is a problem with the system but reducing it for everyone who receives it would only cause more problems.

    So everyone should be paid according to their need? :rolleyes:


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Spudmonkey wrote: »
    So everyone should be paid according to their need? :rolleyes:

    From each according to his ability, to each according to his need :P


  • Posts: 3,925 ✭✭✭ [Deleted User]


    ei.sdraob wrote: »
    From each according to his ability, to each according to his need :P

    The problem is that people's needs are beyond met. Many people are just stupid with their benefit money.


  • Registered Users, Registered Users 2, Paid Member Posts: 24,639 ✭✭✭✭Cookie_Monster


    About time, the tax base in this country has been too narrow for far too long.
    It definitly needs downward adjustment, but also a higher band.

    This will of course affect me before anyone harps on and I obviously do not want to pay more tax but it needs to be done.

    The point about SW is also relevant. There should be some factoring brought in, ie if you ar on minimum wage paying the proposed new tax rates and bands, the dole need to be a significant % less than this per week to encourange working while also providing some reasonable level of support to people


  • Registered Users, Registered Users 2 Posts: 725 ✭✭✭rightwingdub


    The tax band needs to be broadened and yes someone starting off at €10k per year should pay tax, I heard the economist Constantin Gurdgiev state that a flat tax of 20% should be introduced and taxes should be directed more towards property.


  • Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭Count Dooku


    The tax band needs to be broadened and yes someone starting off at €10k per year should pay tax, I heard the economist Constantin Gurdgiev state that a flat tax of 20% should be introduced and taxes should be directed more towards property.
    Property tax is another way to hit poor working people more because they will have to pay it for unemployed, OAP, people in negative equity etc..


  • Registered Users, Registered Users 2 Posts: 725 ✭✭✭rightwingdub


    Property tax is another way to hit poor working people more because they will have to pay it for unemployed, OAP, people in negative equity etc..

    Most OAPS, all the unemployed should be exempt from a property tax.


  • Posts: 3,925 ✭✭✭ [Deleted User]


    I think Count means that the working poor people will be paying not just their own property tax, but in essence unemployed people/OAP's (people who would be excluded) too.


  • Registered Users, Registered Users 2 Posts: 725 ✭✭✭rightwingdub


    Rojomcdojo wrote: »
    I think Count means that the working poor people will be paying not just their own property tax, but in essence unemployed people/OAP's (people who would be excluded) too.

    Most of the working poor should never have been approved for a mortgage over the last 10-12 years, they would have been better off renting.


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  • Registered Users, Registered Users 2 Posts: 9,026 ✭✭✭Lockstep


    I can see benefits in widening the income tax base to include low paid workers.

    Idea being that everyone should pay income tax, even if they can only contribute a small amount. Would help raise some extra revenue but I'm mainly into the idea as a sort of solidarity; idea being that we're all part of a society with everyone contributing what they can afford.


  • Registered Users, Registered Users 2 Posts: 175 ✭✭zielarz


    Abandon income tax all together with a drastic budget cuts. That's the proper way of solving the problem.


  • Closed Accounts Posts: 764 ✭✭✭beagle001


    Problem is in this country the taxed money will only be wasted by a government department and unaccounted for.
    The people who think they can save money on the dole are obviously living at home with their folks or have some saving or everything paid for them.
    Not everyone gets a medical card or rent allowance beside`s the hype media stories.
    If we had a decent government who could guarantee that all the collected money would be pooled into a fund to stimulate jobs and take people of welfare then I believe the general population would accept the extra tax,I think it is only going to be a minor tax even when it is implemented and it will be wasted.


  • Registered Users, Registered Users 2 Posts: 3,086 ✭✭✭Nijmegen


    I never can figure out why we here in Ireland look at things like applying a broad tax base and social welfare in a targeted, means tested manner such as they do in France, Germany, Sweden, etc etc etc.

    We're like the people discovering fire for the first time when introduced to the concept of a state that tracks its people in all their circumstances - if you live at home and collect the dole while your parents work, why don't we cut your dole? If your parents earn X amount and have Y many kids, why don't we give them a tax break?

    Our state agencies are so dysfunctional that different ones have different criteria for means testing the same things... It's crazy!

    Everyone should pay some tax, even a rennet a month is a contribution! And we should have a linked up system that takes your entire life in stock when deciding how to fork out benefits or taxes.

    It's not impossible rocket science to achieve.


  • Registered Users, Registered Users 2 Posts: 13,104 ✭✭✭✭djpbarry


    beagle001 wrote: »
    Problem is in this country the taxed money will only be wasted by a government department and unaccounted for.
    That is true of every country - inefficiency is part of life. It can be minimised, but it cannot be eliminated.
    beagle001 wrote: »
    The people who think they can save money on the dole are obviously living at home with their folks or have some saving or everything paid for them.
    Let's take the case of a single individual with no dependents as an example - you don't think that they could survive on less than 196 Euro per week?


  • Closed Accounts Posts: 18,163 ✭✭✭✭Liam Byrne


    Nijmegen wrote: »
    if you live at home and collect the dole while your parents work, why don't we cut your dole?

    Agreed.
    Nijmegen wrote: »
    If your parents earn X amount and have Y many kids, why don't we give them a tax break?

    Er.....because they chose to have kids ? Why should that entitle them to a tax break ?


  • Registered Users, Registered Users 2 Posts: 3,086 ✭✭✭Nijmegen


    Liam Byrne wrote: »
    Agreed.



    Er.....because they chose to have kids ? Why should that entitle them to a tax break ?
    What I mean is, means test. If we take dole off of young adults living at home, we should ensure that their family doesn't suffer if they rely on that income same as any other family.

    It's the general principal of means testing to ensure we give people what they need, not too much or too little.


  • Closed Accounts Posts: 21,727 ✭✭✭✭Godge


    ei.sdraob wrote: »
    From each according to his ability, to each according to his need :P

    just like in North Korea, just add on self-reliance as well.


  • Registered Users, Registered Users 2 Posts: 855 ✭✭✭smokin ace


    i work 4 days a week 6 hours a day and get crap wages (€210 this week) i rent a room for €75 a week plus food costs and other bills(credit union esb running a car to get to work) i cant get a part payment off the dole because i am working 4 days i cant get rent allowance because i am working and they wont give me a medical card i am left with €10 for myself after paying my bills there is no such thing as me going for a pint because i cant afford it and i dont smoke
    how can i afford to pay tax or even a better question why am i working at all because if i was not working i would get everything paid for for example rent allowance and a medical card and what ever perks that comes along with being unemployed in this country of ours


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  • Posts: 3,925 ✭✭✭ [Deleted User]


    smokin ace wrote: »
    i work 4 days a week 6 hours a day and get €220 a week i rent a room for €75 a week plus food costs and other bills(credit union esb running a car to get to work) i cant get a part payment off the dole because i am working 4 days i cant get rent allowance because i am working and they wont give me a medical card i am left with €10 for myself after paying my bills there is no such thing as me going for a pint because i cant afford it and i dont smoke
    how can i afford to pay tax or even a better question why am i working at all because if i was not working i would get everything paid for for example rent allowance and a medical card and what ever perks that comes along with being unemployed in this country of ours

    This is the problem. You obviously spend money getting to and from work. You pay your own rent etc, all out of 220 euros. Really irks me when people complain that 200 euro a week (PLUS rent allowance/med card etc) for doing absolutely nothing is not enough.

    People's idea of what their lives should be like while on the dole is simply over inflated.


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