Entitlement Culture killing the will to work in Ireland

srsly78

It's more than 50% actually :pac: This will probably kick in on any income above e32k for many people. PRSI+USC+Higher rate.

efb

Kaiser2000 wrote: »

I just came up with another reason that kills the will to work in this country - the tax system.

I worked damn hard and was given the maximum score on my performance review last year which should mean this month I'd see a nice bonus in my paycheque, but I just woke up to find that 50% of what I've been paid this month (salary + bonus) has been deducted as tax - not forgetting the €200 a month I'm losing too thanks to the changes to the single parent tax credit, but which costs me a lot more than that to support my child.

I thought it might be a mistake but according to the XLS on taxcalc.eu it's right alright. I'm not on the magical €60k "average wage" (or even close) either.

Seriously.. why should I bother even going in today?

If you don't early over €60K 50% of your salary is not gone on taxes

srsly78

Oh yes lets argue over the meaning of "tax". PRSI and USC don't count right?

efb

srsly78 wrote: »

Oh yes lets argue over the meaning of "tax". PRSI and USC don't count right?

No you can add them all

srsly78

Read his post again, he was referring to his "bonus". Not to the effective rate on his entire salary. Any income over e32k gets over 50% deducted for most people.

efb

Her is a single persons tax liability at 59,000 where all income is taxable

33.57% of the income is "lost" to taxes

srsly78

Yes but that isn't what the poster claimed, read it again.

efb

That will reduce over the course of the year (more will fall into the lower rate) as the months go by unless he receives similar bonuses each month.

But if your total taxable income for the year does not exceed €59K, your prevailing rate is 33.57% for the year.

It's cumulative

srsly78

You miss the point. Why bother to do extra work/overtime if you know you will only get <50% of the benefit?

Potatoeman

If you add social welfare and whatever housing allowance you can get how does it compare to the minimum wage?

Valetta

srsly78 wrote: »

You miss the point. Why bother to do extra work/overtime if you know you will only get <50% of the benefit?

Because if you don't do extra work you will get nothing?

I know which I'd prefer.

srsly78

Sure you might do a bit, but you won't be that pushed about it. Many people do the maths in their head and decide when it's not worth it.

efb

srsly78 wrote: »

You miss the point. Why bother to do extra work/overtime if you know you will only get <50% of the benefit?

Over the year you will get over 65% of the benefit

I'd rather 65% of 60k than 100% of 16K

Self esteem is important too

efb

srsly78 wrote: »

You miss the point. Why bother to do extra work/overtime if you know you will only get <50% of the benefit?

Is missing the point seeing the miscalculation?

srsly78

There is no miscalculation, rather the comparison of apples and oranges. You talk about effective tax rate on total salary, while the point under discussion is tax on bonus salary.

Also, you can have your self-esteem - but 6 months a year on holidays is better.

golfwallah

Before introducing the welfare cap in the UK, a spokesman for Prime Minister, David Cameron, said

"We can't have a system where people are claiming benefits which are greater than you would get if you were in a job paying £35,000."

http://www.huffingtonpost.co.uk/2012/01/23/benefit-cap-argument-limit-26000_n_1222992.html

Certainly, there are arguments for and against a welfare cap along similar lines being introduced in Ireland, and Minister, Joan Burton, would not be in favour, IMO.

But wouldn't it be in the interests of democracy to have a more open debate on the issue - particularly when you consider the disincentive to work caused by growing tax rates? That said, the withdrawal from public view of one controversial report by the ESRI on the subject, does not bode well for an informed public debate - better keep it all under wraps, what, what!

srsly78

The rich need to pay more tax right?

golfwallah

srsly78 wrote: »

The rich need to pay more tax right?

There has to be something wrong with a system where ordinary working men and women have to pay high taxes on average earnings, compared to many on welfare who can have a better lifestyle by doing nothing - pure and simple!

These people on average earnings are not "rich", yet they are subsidizing many welfare recipients who have better lifestyles than themselves.

This disincentive to work is the nub of the argument - not taxing these "rich" people even more!

The argument for imposing more tax on the top earners is "off thread" and another argument entirely.

intellectual dosser

Are tax bands adjusted annually? (ie. to align with inflation)

Idbatterim

Her is a single persons tax liability at 59,000 where all income is taxable

33.57% of the income is "lost" to taxes

Yeah, this is fairly obvious, its fairly obvious they cant tax all income at over 50%. Bottom line is, when you work earn over E32,800 as a single person, 52% is going to those parasites, to continue the gravy train for a whole host of Irish society. FG have said they will lower it, as they themselves have referred to it as scandalous, will be this year budget or next. Having only 2 tax bands is ridiculous, there should be at least 3, or simply have a flat rate, but hang on, that wouldnt be fair would it, someone earning 100k paying in "only" 5 times more than someone on 20k... :rolleyes: Ireland, the best little country in the world to get shafted at every turn for trying to make a modest living...

Are tax bands adjusted annually? (ie. to align with inflation)

you have to be joking, no they arent, it depends on the on the finances of the country at the time. What is pretty insane to me is, how low the threshold and how high the marginal rate was / is even after endless FF giveaways, it goes to show how they just bought off every sector of society, "fairness" has nothing to do with it.

The rich need to pay more tax right?

This is where the definition of "rich" comes in, average joes even on 80-100k who some might define as "rich" cant avail of all the tax avoidance measures that someone on a multiple of the figure could...

AlekSmart

This Irish Times pre-Christmas piece may or may not be relevant to this thread,but it does put some specific figures on the bones being discussed here..?

http://www.irishtimes.com/news/social-affairs/kitty-holland-7.2276472

What looks like a €363.60 Per Week payment....?

Any other observations on this situation ?

Potatoeman

AlekSmart wrote: »

This Irish Times pre-Christmas piece may or may not be relevant to this thread,but it does put some specific figures on the bones being discussed here..?

http://www.irishtimes.com/news/social-affairs/kitty-holland-7.2276472

What looks like a €363.60 Per Week payment....?

Any other observations on this situation ?

That link takes me to a brief profile of her. I dont see the story. How do they breakdown that figure because minimum wage is just under 9 euro an hour so about 360 per week.

Farmer Pudsey

Kaiser2000 wrote: »

I just came up with another reason that kills the will to work in this country - the tax system.

I worked damn hard and was given the maximum score on my performance review last year which should mean this month I'd see a nice bonus in my paycheque, but I just woke up to find that 50% of what I've been paid this month (salary + bonus) has been deducted as tax - not forgetting the €200 a month I'm losing too thanks to the changes to the single parent tax credit, but which costs me a lot more than that to support my child.

I thought it might be a mistake but according to the XLS on taxcalc.eu it's right alright. I'm not on the magical €60k "average wage" (or even close) either.

Seriously.. why should I bother even going in today?

I agree that the tax system is totally disfunctional. People are hitting over 50% tax rates on quite low income. It causes havoc with employers as often in quite ordinary jobs where bonus or extra work is reqiure the system takes a large portion of this. It discourages workers often from taking promotion or doing extra work as a high% of income is taken by the tax system. For some one that is maybe geting a Bonus of 1-2K or asked to work an extra day in the week for 130 euro and finf that 53% is taken away as well as the extra cost often involved in that bonus or work it ruins the incentive.

I garee with the government about limiting the extra tax relief assaciated with Single Prents. As a parent of three kids I get nothing extra from the tax system even though it cost a lot to rear same. This is the responsibility if having childern entails it cost money. It might encourage people to be more responsible in there matimmg habits.

srsly78 wrote: »

The rich need to pay more tax right?

How do you quantify rich the reality is that the ver rich are able to work around the tax system and if you increase too much thet leave the country. If you increase it more more will leave it is the law od beminishing retutrns. It is one thing I have respect for Micheal O'Leary for unlike other wealty inviduals he did not do a runner.

golfwallah wrote: »

There has to be something wrong with a system where ordinary working men and women have to pay high taxes on average earnings, compared to many on welfare who can have a better lifestyle by doing nothing - pure and simple!

These people on average earnings are not "rich", yet they are subsidizing many welfare recipients who have better lifestyles than themselves.

This disincentive to work is the nub of the argument - not taxing these "rich" people even more!

The argument for imposing more tax on the top earners is "off thread" and another argument entirely.

The reason that tax are so high is the entitle ment culture. Take Kaiser he feels that he is entitled to a higher tax credit because he has a single child with another invidual and they are not partaking in a family unit. The vast majority of working familys recieve no extra tax benifit so why should he.

The biggest issue in Ireand is where we limit taxes through waivers or extra entitlements or pay benifit on top of benifit where people make lifestyle choices which may be irresponsible. The lad that thinks I need not work the state will provide me with an adequate lifestyle. All those politician that have retire on huge pensions.

The penelty points fiasco is a case of entitlement. These inviduals not just the guards involved felt that they were entitled to this. Alan Shatter taught he was entitles to drive away from a Garda checkpoint.

Idbatterim

How do you quantify rich the reality is that the very rich are able to work around the tax system and if you increase too much thet leave the country. If you increase it more more will leave it is the law od beminishing retutrns. It is one thing I have respect for Micheal O'Leary for unlike other wealty inviduals he did not do a runner.

I dont know, in regards to O'Leary, the notion I was contributing massive sums to the exchequer, when so much is wasted or to pay the likes of Kennys etc salary, why not move his tax affairs out of the country and if he is so concerned with doing the right thing, donate it to Irish charities etc, not to the likes of Angela Kerins and the rest of the cronies...

spank_inferno

intellectual dosser wrote: »

Are tax bands adjusted annually? (ie. to align with inflation)

No.... And its cunning on the governments part.

Taking inflation @ 2% per annum.
We have 10% less purchasing power since the crash in 2008.

spank_inferno

Also re: "Tax the rich".

The vast majority of wealth is in assets, not year to year income.

So arguing over PAYE rates for the few thousands very high income tax payers is less relevant when compared to asset wealth.

To enhance gov revenue, I'd have no issue with a land tax.

Idbatterim

Taking inflation @ 2% per annum.
We have 10% less purchasing power since the crash in 2008.

Exactly, the same way it is devaluing, welfare, pensions etc, its a powerful tool. People reckon, hey this isnt too bad, we arent being cut again, its a cut by stealth. Which in the case of welfare and PS wages and pensions is no bad thing...

Valetta

There was deflation in 2009 and 2010, so it's not nearly as bad as being said.

efb

srsly78 wrote: »

There is no miscalculation, rather the comparison of apples and oranges. You talk about effective tax rate on total salary, while the point under discussion is tax on bonus salary.

Also, you can have your self-esteem - but 6 months a year on holidays is better.

No not at all well for those that get bonuses in the currant climate, Irish Water?

efb

srsly78 wrote: »

There is no miscalculation, rather the comparison of apples and oranges. You talk about effective tax rate on total salary, while the point under discussion is tax on bonus salary.

Also, you can have your self-esteem - but 6 months a year on holidays is better.

He said salary and bonus