Budget 2016

Idbatterim

So reading about the 2% USC cut and the welfare bonus increase...

Im my opinion, the only rate that should be cut, is the marginal income tax rate, far too many, already pay in too little in income taxes. Far too many have been removed from the tax net...

BUT as it is an election year and hence budget, everyone is going to be given a little something, regardless of merit.

The welfare bonus increase is a shrewd move IMO. It gives something to those on welfare, BUT it is a one off payment and if payment needs to be cut in the future, it can be claimed it isnt a core payment. It also isnt a weekly increase.

Its a balancing act between doing enough to get re-elected and not doing more damage than needs to be done economically... Unlike FF who kept on throwing petrol on the flames, once re-election has been secured, with a solid enough majority, you can then simply sustain rates or increase them meagre amounts, before the next budget. Wash and repeat (It seems to be the best option given the Irish populace).

I have read about the extra several hundred guardai. But this leads to another issue, we dont have enough prison spaces to put all the scumbags away. Maybe they will address this in next years budget...

BoJack Horseman

yeah its a shame about the USC... but its a headline grabber so one can see its political merit.

USC is a very successful tax that no one escapes, it covers everything both earned & unearned income.... its progressively tiered & far reaching.

If the objective was helping those at the bottom, things like VAT reform or modifying income tax bands would be better... but not as sexy

Villa05

Idbatterim wrote:

Im my opinion, the only rate that should be cut, is the marginal income tax rate, far too many, already pay in too little in income taxes. Far too many have been removed from the tax net...

If that is being cut then all tax exemptions should be at the standard rate only.
People on low incomes are getting hammered with rent increases and health is an unaffordable luxury.
Many will see social welfare as a viable alternative to work.

Eric Cartman

Usual election budget of silly offers for tax payers that inflation or another tax wipes away pretty quick and a massive giveaway to the unemployed to keep them on side.

Dob74

Eric Cartman wrote:

Usual election budget of silly offers for tax payers that inflation or another tax wipes away pretty quick and a massive giveaway to the unemployed to keep them on side.

I am sure there will be the usual KPMG or some other accounting firm examples of John and Mary benefiting from income tax cuts. Not taking into account vat and other indirect taxes paid.

murphaph

Dob74 wrote: »

I am sure there will be the usual KPMG or some other accounting firm examples of John and Mary benefiting from income tax cuts. Not taking into account vat and other indirect taxes paid.

Yep. The salivating over the budget seems to be something we inherited from the British. Nobody here in Germany even knows when the budget is. It's not used for grandstanding as it is in the British Isles with he holding up the briefcase rubbish and all that goes with it.

Godge

BoJack Horseman wrote: »

yeah its a shame about the USC... but its a headline grabber so one can see its political merit.

USC is a very successful tax that no one escapes, it covers everything both earned & unearned income.... its progressively tiered & far reaching.

If the objective was helping those at the bottom, things like VAT reform or modifying income tax bands would be better... but not as sexy

I agree on USC. I also don't understand the rush to get rid of it. Each 1% of USC takes in more than 1% of income tax, so if you could cut USC rates by 2%, you could probably cut both income tax rates by 3%, creating a bigger headline.

Godge

Villa05 wrote: »

If that is being cut then all tax exemptions should be at the standard rate only.
People on low incomes are getting hammered with rent increases and health is an unaffordable luxury.
Many will see social welfare as a viable alternative to work.

Don't we have half the population on medical cards so how can people on low incomes see health as unaffordable luxury?

Dob74

murphaph wrote:

Yep. The salivating over the budget seems to be something we inherited from the British. Nobody here in Germany even knows when the budget is. It's not used for grandstanding as it is in the British Isles with he holding up the briefcase rubbish and all that goes with it.

It's a joke. Why not announce the budget for 2016 in july and debate it in September and October. Have it finalised by November. Instead of all this last minute funny business.

murphaph

I'd go further and say multi annual budgets encompassing some long term planning should be par for the course but it won't happen.

Irish_rat

So how much will you save per year on lets say 50,000?

Villa05

Godge wrote:

Don't we have half the population on medical cards so how can people on low incomes see health as unaffordable luxury?

This is ireland it is not the most needy that get medical cards rather the more vocal, those that have a good relationship with their TD, those that are more likely to vote and those that can manipulate income.

What percentage of paye workers have medical cards

Nichard Dixon

murphaph wrote: »

I'd go further and say multi annual budgets encompassing some long term planning should be par for the course but it won't happen.

This is the most disappointing thing. There is no sense of what level of expenditure and tax is sustainable in the medium term, rather they just fiddle with this and that to sweeten a few voters.

Riskymove

Dob74 wrote: »

It's a joke. Why not announce the budget for 2016 in july and debate it in September and October. Have it finalised by November. Instead of all this last minute funny business.

it is too early in July to know to make a final call on what income you have and what you have available to spend

anything could happen in the second six months

touts

This budget is largely a pretend one and I find it hard to get excited about it. Whatever they give (or take) will only be for a couple of months so we'll hardly notice it. The real 2016 budget will be about a month after the election when whoever makes up the new government comes in looks at the books and tells us "We're sorry but it's far far worse than we were lead to believe". What we get then in terms of tax changes spending policy etc will be a far more significant indication of how things will shape up for the next 5 years.

JustTheOne

If only we had a government ballsy enough to cut social welfare and reduce the 1 in 2 receiving benefits each week

Then direct that to healthcare.

No party would do it because they would never be voted in again.

Great little country ay.

Idbatterim

all workers should simply vote FG, we get screwed because we dont act as one... Any other party gets in with SF and we keep up the current welfare wonderland situation, thats the unfortunate reality...

Letree

Expect large rises in property tax and water charges after the budget to pay for all these giveaways.

Nichard Dixon

Letree wrote: »

Expect large rises in property tax and water charges after the budget to pay for all these giveaways.

Well we probably should follow the OECD advice... :rolleyes:.

Dob74

Idbatterim wrote:

all workers should simply vote FG, we get screwed because we dont act as one... Any other party gets in with SF and we keep up the current welfare wonderland situation, thats the unfortunate reality...

Why vote for FG? Despite there claims as a low tax party. They hand out handy contracts to there tax exile friends and just pass the bill onto the public.
Coporate welfare has never been so expensive.

touts

Dob74 wrote: »

Why vote for FG? Despite there claims as a low tax party. They hand out handy contracts to there tax exile friends and just pass the bill onto the public.
Coporate welfare has never been so expensive.

I think history may well judge this FG government very harshly when it comes to some, shall we say, "unusual" sales of state owned assets and the later adjustment of government policy that made those assets quite valuable. Sort of like the rezoning lark FF got up to but focused on one or two of their "supporters" as opposed to the many small fish FF could cram into the Galway tent. But none of that will be clarified in time for the next election. Most people will vote based on promises that will never be kept.

RustyRobo

JustTheOne wrote: »

If only we had a government ballsy enough to cut social welfare and reduce the 1 in 2 receiving benefits each week

If only we had a government with enough morals and ethics to tackle the rich individuals and organisations that keep them in power at the expense of the common citizen. If you call cuts to "social welfare" measures to put people out of their homes and hence live on the streets - loss of public services -a devastated health service - care homes closing etc... So is this the society you are looking forward to? If it is then the Lord help you when you or your loved ones need to call back on on all the taxes (direct and indirect) that have been paid over a lifetime. I guess you just want want the rich to get fatter and the most needy in our society to go to the wall.

Dob74

touts wrote:

I think history may well judge this FG government very harshly when it comes to some, shall we say, "unusual" sales of state owned assets and the later adjustment of government policy that made those assets quite valuable. Sort of like the rezoning lark FF got up to but focused on one or two of their "supporters" as opposed to the many small fish FF could cram into the Galway tent. But none of that will be clarified in time for the next election. Most people will vote based on promises that will never be kept.

I would say people vote out of self interest rather than election promises.
FF and FG have one thing in common, there friends get rich at the expense of the working taxpayer.
As for the budget it looks like the usual tax cuts and spending increases. We are well on our way back to bankruptcy again.

Nichard Dixon

Dob74 wrote: »

As for the budget it looks like the usual tax cuts and spending increases. We are well on our way back to bankruptcy again.

Well I am not using my tax cuts to buy bank shares this time, or if I so I'll sell out sooner rather than later.

suicide_circus

For once I would agree with Fergus Finlay when he said yesterday that instead of adding an additional fiver to the non means tested child benefit (which most won't notice) as is planned for the budget, Joan Burton should use that €70m in a far more targeted way where it will really be felt such as respite for carers, SNAs, theatre nurses etc

It is depressing that Governments feel required to do this.

An electorate still being 'trained' by Operant conditioning.

fliball123

JustTheOne wrote: »

If only we had a government ballsy enough to cut social welfare and reduce the 1 in 2 receiving benefits each week

Then direct that to healthcare.

No party would do it because they would never be voted in again.

Great little country ay.

The problem there is that still wont sort out the HSE we spend a hell of a lot on health and the area is so poorly managed that any other money directed would surely be wasted.

Letree

fliball123 wrote: »

The problem there is that still wont sort out the HSE we spend a hell of a lot on health and the area is so poorly managed that any other money directed would surely be wasted.

Ah ha fliball its that time of year again. Good to see you up and at it before budget day. Still bothered by the PS i see. Do you dream about it.

jank

murphaph wrote: »

Yep. The salivating over the budget seems to be something we inherited from the British. Nobody here in Germany even knows when the budget is. It's not used for grandstanding as it is in the British Isles with he holding up the briefcase rubbish and all that goes with it.

Same here. There is a budget 'day' that does get some press coverage but no the endless weeks and months of speculation and kite flying that Ireland seems to engage in. Its a circus where politics overtakes policy and economics.

johnnyskeleton

BoJack Horseman wrote: »

USC is a very successful tax that no one escapes, it covers everything both earned & unearned income.... its progressively tiered & far reaching.

It was intended as an emergency measure to deal with the recession. Fair enough, we can all pay a little bit more in solidarity with those who are the worst hit by the recession.

But as with a lot of taxes and charges, they are brought in as a temporary measure but are then kept long term.

Eric Cartman wrote: »

Usual election budget of silly offers for tax payers that inflation or another tax wipes away pretty quick and a massive giveaway to the unemployed to keep them on side.

FF made a suggestion that they are going to level the playing pitch for self employed people by giving them the same tax credits and rates of USC etc as PAYE employees if they pay tax on a monthly basis. FG have made vague comments about equalisation as well:

http://www.finegael.ie/latest-news/2015/fine-gael-is-standing-up--1/

To be honest, this is a very important issue to me as a self employed person. It goes beyond merely wanting to pay less tax. It recognises that you can't just arbitrarily say "oh hey, let's increase tax on the self employed because we can, and sure they are all coining it anyway" and towards recognising that self employed people make a valuable contribution to the economy.

So if they live up to their promises I think it would be a good move, even if the actual benefits are notional or are eaten away by another tax or inflation.

johnnyskeleton

Letree wrote: »

Ah ha fliball its that time of year again. Good to see you up and at it before budget day. Still bothered by the PS i see. Do you dream about it.

Mod Note:

Let's not get personal, okay?

fliball123

Letree wrote: »

Ah ha fliball its that time of year again. Good to see you up and at it before budget day. Still bothered by the PS i see. Do you dream about it.

no bothered that the HSE get a lot of money already and do a p1ss poor job for the money that is put into it and throwing money at it is not going to sort the problem of the layer of redundant middle management that is with in the organisation.. Being honest the PS need more staff , I would have no bother with PS staff who are working hard and returning an actual decent service to the public getting a payrise but unfortunately that will never happen

creedp

johnnyskeleton wrote: »

To be honest, this is a very important issue to me as a self employed person. It goes beyond merely wanting to pay less tax. It recognises that you can't just arbitrarily say "oh hey, let's increase tax on the self employed because we can, and sure they are all coining it anyway" and towards recognising that self employed people make a valuable contribution to the economy.

As with all measures, they are supported by the people who benefit most from them. The self-employed are no different to any other tax pay in that regard. There are many tax measures available to the self-employed I as an employee would love to benefit from and would certainly support if proffered, e.g. I would love to be able to buy a BMW X5 to use for my commute and write off the purchase price against tax as well as the considerable cost of running it. It will never happen of course but once can dream!

Damien360

creedp wrote: »

As with all measures, they are supported by the people who benefit most from them. The self-employed are no different to any other tax pay in that regard. There are many tax measures available to the self-employed I as an employee would love to benefit from and would certainly support if proffered, e.g. I would love to be able to buy a BMW X5 to use for my commute and write off the purchase price against tax as well as the considerable cost of running it. It will never happen of course but once can dream!

Your local plumber, electrician, chippy etc are all self employed. They don't drive X5's and if they did, it comes from hard work. They use vans, which have a cost, and they can claim back taxes on this. They are not cheap to maintain and ultimately it keeps your bill that little bit lower as they are not double taxed for the van use. They write off a PORTION of the cost against tax. Far from getting it for free.

You cannot tar all self employed with the same brush. I ran my own car for work (as business use) and it is not cheap. Even with civil service rates to claim back some costs, I broke even on 50000KM per year on a mondeo. Also, you do not commute to the office in a company car/van for work purposes. That is not claimable.

creedp

Damien360 wrote: »

Your local plumber, electrician, chippy etc are all self employed. They don't drive X5's and if they did, it comes from hard work. They use vans, which have a cost, and they can claim back taxes on this. They are not cheap to maintain and ultimately it keeps your bill that little bit lower as they are not double taxed for the van use. They write off a PORTION of the cost against tax. Far from getting it for free.

You cannot tar all self employed with the same brush. I ran my own car for work (as business use) and it is not cheap. Even with civil service rates to claim back some costs, I broke even on 50000KM per year on a mondeo. Also, you do not commute to the office in a company car/van for work purposes. That is not claimable.

I'm not tarring anyone with any brush. Seems a bit of an over reaction. To be honest the only time I get offered a reasonable reduction from one of the categories you mention is when they give me a cash only price. Each to their own and again as in all things you get away with what you can get away with!!

I was making the point that some desirable self-employed tax allowances are not available to employees and you can argue whether this is appropriate or not as you wish. While of course some self-employed people use their basic vans for work only, there is an increasing incidence of cases where self-employed people/companies are putting high spec/luxury vehicles on the road with either the rear seats removed or in some cases not which are being set off against tax. Of course you can argue they are worth it because they work hard etc. On the other hand you could argue why should the taxpayer supplement the premium associated with these luxury vehicles and maybe if the capital allowances/VRT rebates etc were capped at a reasonable level them the smaller business could still avail of the full benefit while self-employed people or business who want their employees to drive around in relative luxury could of course pay for the premium just like everybody else.

Sleepy

Idbatterim wrote: »

all workers should simply vote FG, we get screwed because we dont act as one... Any other party gets in with SF and we keep up the current welfare wonderland situation, thats the unfortunate reality...

I'll vote for them as the least worst option myself but I think you're living in a fantasyland if you think a majority FG government would be that drastically different from the current one...

Stereomaniac

Fine Gael are going to be the exact same as they have been the last few years, regardless of who they go in there with. Personally I would welcome a change to the other lads again now.

Sleepy

Yeah, let's give the levers of power back to the morons who created the mess FG have spent the last few years cleaning up... :rolleyes:

paul71

creedp wrote: »

As with all measures, they are supported by the people who benefit most from them. The self-employed are no different to any other tax pay in that regard. There are many tax measures available to the self-employed I as an employee would love to benefit from and would certainly support if proffered, e.g. I would love to be able to buy a BMW X5 to use for my commute and write off the purchase price against tax as well as the considerable cost of running it. It will never happen of course but once can dream!

I am sure you would as would the self employed, however they cannot. The upper scale limit for capital allowances on a passenger vehicle is currently €24,000 written off over 8 years. Additionally the private proportion of the expense of running such a vehicle is not allowable and that includes the mileage incurred in comuting to and from the place of business from the taxpayers residence.

I am afraid the perception of tax breaks to self-employed are largely just uninformed myths, indeed most low earning self-employed suffer significant disadvantages in comparision to employed persons on identical earnings in terms of tax and access to social welfare and thrid level grants.

Irish_rat

How much money a year will we get back from tax reduction?

touts

Irish_rat wrote: »

How much money a year will we get back from tax reduction?

Not a huge amount. They have maybe €1.5b to play with and there will be a lot of pressure to increase spending on the usual suspects of health and education. Burton will also want to bump up various welfare payments to try and boost Labour support. There will be pressure to hire new Gardaí and the navy must have blown the defense budget by operating in the mediterranean. And they have to find money for 4000 refugees and thousands of homeless. So overall there are a lot of valid spending calls for some of that €1.5b.

There will be some tax reduction BUT it will sound better when Noonan announces it than it actually turns out to be in your pay packet. That's part of the reason there is speculation that the government will move for an election before Christmas.

creedp

paul71 wrote: »

I am sure you would as would the self employed, however they cannot. The upper scale limit for capital allowances on a passenger vehicle is currently €24,000 written off over 8 years. Additionally the private proportion of the expense of running such a vehicle is not allowable and that includes the mileage incurred in comuting to and from the place of business from the taxpayers residence.

I am afraid the perception of tax breaks to self-employed are largely just uninformed myths, indeed most low earning self-employed suffer significant disadvantages in comparision to employed persons on identical earnings in terms of tax and access to social welfare and thrid level grants.

I was referring to the kind of thing that is discussed in this post.
http://touch.boards.ie/thread/post/9479075

Its a bit of a red herring talking about passenger cars and self-employed driving from their homes to place of work. Next thing you'll be saying is that its a myth that self employed can reclaim vat on diesel as all self employed drive petrol engined vans.

l think its a fair point that there are positives and negatives to the tax regimes applying to both sectors but each sector will vehemently argue that the grass is greener on the other side.

Greyian

creedp wrote: »

I was referring to the kind of thing that is discussed in this post.
http://touch.boards.ie/thread/post/9479075

Its a bit of a red herring talking about passenger cars and self-employed driving from their homes to place of work. Next thing you'll be saying is that its a myth that self employed can reclaim vat on diesel as all self employed drive petrol engined vans.

l think its a fair point that there are positives and negatives to the tax regimes applying to both sectors but each sector will vehemently argue that the grass is greener on the other side.

I've know and have met plenty of self-employed people, and not one of them has purchased a vehicle for private use through their business.

paul71

creedp wrote: »

I was referring to the kind of thing that is discussed in this post.
http://touch.boards.ie/thread/post/9479075

Its a bit of a red herring talking about passenger cars and self-employed driving from their homes to place of work. Next thing you'll be saying is that its a myth that self employed can reclaim vat on diesel as all self employed drive petrol engined vans.

l think its a fair point that there are positives and negatives to the tax regimes applying to both sectors but each sector will vehemently argue that the grass is greener on the other side.

I dont understand your point, it is the red herring that you brought up in your previous post. You stated that you would love to avail of the opertunity to buy a BMW and write off the commute to work in it like the self-employed, I simply stated that no-one can do this and that it is a myth. Are you claiming that this is not the case?

I never mentioned deisel cars, but since you have I will state that VAT on diesel for personal use cannot be reclaimed.

Dob74

Irish_rat wrote:

How much money a year will we get back from tax reduction?

Not as much as your water bill or the increase in rent.
For some reason the government is doing its best to keep property prices High. Which is a tax on workers not owning an existing property. Personally I would prefer if they left income taxes alone and put the money into infurstructure. We need schools ,roads, houses etc.
The government keep claiming the 'free market' forces are at play. But when they own the banks, own most property thru nama and the banks, control planning, control the pay rates of most sectors, regulate how much can be lent to a buyer, decide what school is to be built where etc etc. They can't claim the free market forces are at work.

Buford T. Justice XIX

Dob74 wrote: »

Not as much as your water bill or the increase in rent.
For some reason the government is doing its best to keep property prices High. Which is a tax on workers not owning an existing property. Personally I would prefer if they left income taxes alone and put the money into infurstructure. We need schools ,roads, houses etc.
The government keep claiming the 'free market' forces are at play. But when they own the banks, own most property thru nama and the banks, control planning, control the pay rates of most sectors, regulate how much can be lent to a buyer, decide what school is to be built where etc etc. They can't claim the free market forces are at work.

That will come but we are still running a deficit on the day to day costs of running the country.

If the current growth rates continue, we will probably balance this coming year and that opens up a lot of options for spending.

Dob74

Buford T. Justice V wrote:

That will come but we are still running a deficit on the day to day costs of running the country.

Buford T. Justice V wrote:

If the current growth rates continue, we will probably balance this coming year and that opens up a lot of options for spending.

But don't cut taxes first. I don't mind paying tax as long as it's going to be spent on something worthwhile.
And like you said if you want to decrease the deficit then don't decrease taxes.

nice_guy80

Dob74 wrote: »

But don't cut taxes first. I don't mind paying tax as long as it's going to be spent on something worthwhile.
And like you said if you want to decrease the deficit then don't decrease taxes.

exactly
taxes fund services

it is the high cost of living we should be tackling

creedp

paul71 wrote: »

I dont understand your point, it is the red herring that you brought up in your previous post. You stated that you would love to avail of the opertunity to buy a BMW and write off the commute to work in it like the self-employed, I simply stated that no-one can do this and that it is a myth. Are you claiming that this is not the case?

I never mentioned deisel cars, but since you have I will state that VAT on diesel for personal use cannot be reclaimed.

Reasonably simple point. Poster said he would support giving PAYE allowance to the self-employed. My comment was there are different tax arrangements for both sectors and while self employed may feel hard done by not getting an employee allowance there are self employed tax allowances which an employee would like to benefit from and I gave an example. I never said an employee should get the self employed allowance (maybe for the same reason the self employed shouldnt get the PAYE allowance) simply that very often the grass seems greener on the other side.

I'm not sure how all that migrated to the self employed buying private petrol passenger cars. The joys of the internet I suppose

paul71

creedp wrote: »

Reasonably simple point. Poster said he would support giving PAYE allowance to the self-employed. My comment was there are different tax arrangements for both sectors and while self employed may feel hard done by not getting an employee allowance there are self employed tax allowances which an employee would like to benefit from and I gave an example. I never said an employee should get the self employed allowance (maybe for the same reason the self employed shouldnt get the PAYE allowance) simply that very often the grass seems greener on the other side.

I'm not sure how all that migrated to the self employed buying private petrol passenger cars. The joys of the internet I suppose

Fair enough, however I still hold that the perception of self-employed having advantages over the employed is an incorrect one. The fact is that in the past (and I mean in the 1970s and 80s) tax evasion was more commonplace, this was because computerised audit trials and risk assesments were not available, I think preople excepted that the PAYE offset this to an extent.

Since the 1990s evasion is more difficult, easier to detect and more severly punished. Given this and since there are no tax benefits available in the tax code to Self-employed that are not available to the employed the extension of the PAYE allowance to the self employed is only equitable.

Unfortunately I am at the coal-face of this and I see the effects of a couple of silly little tax laws on very low paid self-employed, (contract cleaners, gardeners, painters ect.) ie. people who earn less then minimum wage for long hours and pay more tax and PRSI than equivelent PAYE workers, they generally cannot afford accountants and if they lose a small proportion of their business have no access to Social Welfare because, DSP require accountants reports which they cant afford to pay for.

AlexisM

paul71 wrote: »

people who earn less then minimum wage for long hours and pay more tax and PRSI than equivelent PAYE workers,

The self-employed get a fantastic deal - the contributory pension for their 4% PRSI contributions. I think low-paid self-employed can contribute something like €500 pa in PRSI and accrue towards the COAP. So 40 years work times €500 = €20,000 - and they get a benefit reckoned to be worth around €300,000.

I think it will be a backwards move if the budget tries to put employed and self-employed on equal terms of tax and PRSI without due regard for the fact that the employed also have 10.75% employers PRSI paid on their behalf. The bulk of the 10.75% employer contribution goes towards the COAP and not the employee benefits that the self-employed are not entitled to.

As long as the self-employed accrue the same COAP as the employed, they should be contributing something extra to compensate for the lack of an employer contribution.