Why must you pay property tax if you were taxed on the money earned to buy the house?

armabelle

Can someone please help me understand this?

thank you

CIARAN_BOYLE

armabelle wrote: »

Can someone please help me understand this?

thank you

why must you pay vat on purchaees if you were taxed on the money earned to buy stuff.

We have multiple layers of taxation in this country.

armabelle

CIARAN_BOYLE wrote: »

why must you pay vat on purchaees if you were taxed on the money earned to buy stuff.

We have multiple layers of taxation in this country.

Well yes if both those questions really do fall under the same category then why? Why are there multiple layers? Are there only those two layers or are you taxed in more layers?

I purchased a used bicycle and never paid tax on that so a house is also "used". Why should you have to pay tax on it?

CIARAN_BOYLE

armabelle wrote: »

Well yes if both those questions really do fall under the same category then why? Why are there multiple layers? Are there only those two layers or are you taxed in more layers?

There are multiple layers to prevent disincentivising work with an outright 70% tax rate.

Also because property tax (stamp duty/ property taxes) was much easier to enforce before record keeping electronic bank records etc. It was a fraud prevention tool.

At the moment the idea seems to be that you should be taxed on your income, your expenses (vat) and your assets.

As to layers of tax your employer may vat on what they sell to make money, they you pay it on what they pay you, you pay vat when you buy something. Everything you buy is more expensive because the workers who made it are paying taxes as part of their wage.

Michael D Not Higgins

The idea of a tax system is to be as broad as possible to be as fair as possible. If you tax a small level on lots of things you get more tax from higher consumers. If you were to concentrate tax into just income tax then you'd hurt the economy via various mechanisms that are outside the scope of this forum.

The real answer to your question is "because we need tax income to run the country".

Speedwell

Your heirs also pay inheritance tax on the property that you paid tax on when you purchased it and property tax on when you owned it, and if they keep it, they will continue to pay property tax and perhaps even capital gains tax on it. If you're asking why you must do this, the answer is currently, "because that is how the tax system is set up". If you're asking whether this is legitimate, the answer is, "if you live in a society, you are expected to follow the laws".

If you don't like the laws, you are entitled to say so and seek to change them. Many people would agree with you. Many would go further and say taxation itself is illegitimate. Some of us have outgrown our naive and selfish libertarian babyhood and understand taxation is the way a good society necessarily funds itself as equitably as possible. Most of us can see ways in which they think the system would work better and more fairly, and discussions to that effect are good things.

dr.fuzzenstein

You pay tax on the money you earn, you then pay VAT on everything you buy and VRT and stamp duty on your car and house. All the money you spend, the guy who gets it pays tax on that. Whatever little money you have left you then get to invest and get absolutely sh*tty return from the bank with the excuse of "interest is really low!" (of course that doesn't stop them from gouging you for your mortgage) and whatever little you get is then taxed via DIRT. The few scraps you manage to put into a pension will mostly go to finance sharks and the rest will be stolen by the state.
So you get done up the tailpipe every step of the way and sometimes you pay tax on your tax (VAT on VRT anyone?). The only way to avoid it is to become a career criminal and only deal in drugs and cash, but the retirement plan (end up in jail or with a bullet in the head) is less than appealing, though the coke and hookers lifestyle will somehow make up for that.
Anyone else having a good Monday?

Speedwell

dr.fuzzenstein wrote: »

Anyone else having a good Monday?

Brill. Hope your day and mine go a bit better

armabelle

dr.fuzzenstein wrote: »

You pay tax on the money you earn, you then pay VAT on everything you buy and VRT and stamp duty on your car and house. All the money you spend, the guy who gets it pays tax on that. Whatever little money you have left you then get to invest and get absolutely sh*tty return from the bank with the excuse of "interest is really low!" (of course that doesn't stop them from gouging you for your mortgage) and whatever little you get is then taxed via DIRT. The few scraps you manage to put into a pension will mostly go to finance sharks and the rest will be stolen by the state.
So you get done up the tailpipe every step of the way and sometimes you pay tax on your tax (VAT on VRT anyone?). The only way to avoid it is to become a career criminal and only deal in drugs and cash, but the retirement plan (end up in jail or with a bullet in the head) is less than appealing, though the coke and hookers lifestyle will somehow make up for that.
Anyone else having a good Monday?

well you know you can't blame criminals for choosing that path.... I mean if it really is between that and the tailpipe...I dont know.

drugs and bullet in the head maybe but you know a lot of criminals are probably just business people with families who dont want to get shafted by the state. Who can blame them really?

armabelle

Speedwell wrote: »

Your heirs also pay inheritance tax on the property that you paid tax on when you purchased it and property tax on when you owned it, and if they keep it, they will continue to pay property tax and perhaps even capital gains tax on it. If you're asking why you must do this, the answer is currently, "because that is how the tax system is set up". If you're asking whether this is legitimate, the answer is, "if you live in a society, you are expected to follow the laws".

If you don't like the laws, you are entitled to say so and seek to change them. Many people would agree with you. Many would go further and say taxation itself is illegitimate. Some of us have outgrown our naive and selfish libertarian babyhood and understand taxation is the way a good society necessarily funds itself as equitably as possible. Most of us can see ways in which they think the system would work better and more fairly, and discussions to that effect are good things.

How much would inheritance tax be for them?

Seems the more you have the more you lose in life nowadays, I can't see how people are supposed to be incentivized to be successful if you are constantly losing out every step of the way

CIARAN_BOYLE

armabelle wrote: »

How much would inheritance tax be for them?

Seems the more you have the more you lose in life nowadays, I can't see how people are supposed to be incentivized to be successful if you are constantly losing out every step of the way

inheritance tax is also called gift tax or officially capital acquisitions tax and is 33% but there is a number of reliefs and exemptions.

armabelle

CIARAN_BOYLE wrote: »

inheritance tax is also called gift tax or officially capital acquisitions tax and is 33% but there is a number of reliefs and exemptions.

jesus 33%! So you work all your life to buy a house for my kids so they have to pay back 33% of it when they inherit it? Surely that can't be right?

Do you by any chance know what kind of reliefs / exemptions there are?

Michael D Not Higgins

armabelle wrote: »

jesus 33%! So you work all your life to buy a house for my kids so they have to pay back 33% of it when they inherit it? Surely that can't be right?

Do you by any chance know what kind of reliefs / exemptions there are?

http://www.revenue.ie/en/tax/cat/thresholds.html

Here are the thresholds.

regi3457

dr.fuzzenstein wrote: »

You pay tax on the money you earn, you then pay VAT on everything you buy and VRT and stamp duty on your car and house. All the money you spend, the guy who gets it pays tax on that. Whatever little money you have left you then get to invest and get absolutely sh*tty return from the bank with the excuse of "interest is really low!" (of course that doesn't stop them from gouging you for your mortgage) and whatever little you get is then taxed via DIRT. The few scraps you manage to put into a pension will mostly go to finance sharks and the rest will be stolen by the state.
So you get done up the tailpipe every step of the way and sometimes you pay tax on your tax (VAT on VRT anyone?). The only way to avoid it is to become a career criminal and only deal in drugs and cash, but the retirement plan (end up in jail or with a bullet in the head) is less than appealing, though the coke and hookers lifestyle will somehow make up for that.
Anyone else having a good Monday?

nowadays a real criminal is the one who actually works within the law not outside of it

dr.fuzzenstein

regi3457 wrote: »

nowadays a real criminal is the one who actually works within the law not outside of it

I always thought that being outside the law was the definition of criminal.

Wanderer78

Our tax regime is a mess. We have to some how start making large multinationals pay more tax, some sort of financial transaction tax is required as well. The worker is getting hammered here

CIARAN_BOYLE

armabelle wrote: »

jesus 33%! So you work all your life to buy a house for my kids so they have to pay back 33% of it when they inherit it? Surely that can't be right?

Do you by any chance know what kind of reliefs / exemptions there are?

yep, ask me tomorrow as I will have my tax notes with me for study. Ive audit with me today.

Exams on tax next week lol, mainly on cat/cgt reliefs.

First of all there is a threshold so you can get a certain amount over your lifetime in gifts tax free (look up cat threshold for details).

Main relief is dwelling house exemption
http://www.revenue.ie/en/tax/cat/leaflets/cat10.html

regi3457

dr.fuzzenstein wrote: »

I always thought that being outside the law was the definition of criminal.

yes, but certain organizations / people work within the law to defraud average people

regi3457

Wanderer78 wrote: »

Our tax regime is a mess. We have to some how start making large multinationals pay more tax, some sort of financial transaction tax is required as well. The worker is getting hammered here

maybe that is the idea?

Wanderer78

regi3457 wrote:

maybe that is the idea?

Oh don't worry I know it is. It's disgusting and is wrecking this planet

relax carry on

regi3457 wrote: »

yes, but certain organizations / people work within the law to defraud average people

What organisations deliberately set out to defraud people? Also individuals deliberately setting out to defraud people are committing an offence, have you informed the relevant authorities?

hidden shallows

The main reason is so that we as a society can keep the PJ-wearing brigade, who've chosen not to work, in the lifestyle they've become accustomed to.

MarkAnthony

Wanderer78 wrote: »

Our tax regime is a mess. We have to some how start making large multinationals pay more tax, some sort of financial transaction tax is required as well. The worker is getting hammered here

The only reason we have workers is because of the tax incentives for companies to come here. Contrary to the indoctrination in the Irish education system, we don't have world class education.

As for tax OP you could do half a dozen PhDs on the subject. Suffice it to say it's a wealth distribution policy in many respects. Some theorists suggest that all taxation if theft but imagine living in a world without it. No police force, ghettos and shantytowns with the 'rich' having to live in compounds with the risk of being murdered whenever they step out. Granted that's the extreme end of the spectrum, but Ireland is hardly an egalitarian society.

It's worth having a google of John Rawls' original position, it's the approach I take.

Wanderer78

hidden shallows wrote:

The main reason is so that we as a society can keep the PJ-wearing brigade, who've chosen not to work, in the lifestyle they've become accustomed to.

The problem isn't with the lower tiers of our social structure but in fact with the higher tiers and more so with the financial sector. The 'pj brigade' actually have a lot of complicated issues that need addressing

Pro Hoc Vice

armabelle wrote: »

Can someone please help me understand this?

thank you

I earn money and pay tax if I use that to buy a car I pay VRT and VAT, if I buy a TV I pay VAT my electricity is charged plus VAT my petrol is plus a number of taxes. I am not aware of any rule that says a person can't pay multiple taxes.

Sh1tbag OToole

Because Europe wants us to pay property tax.

It's a load of b0ll1x but this tax was foisted upon us by Europe and our TD's went along with it. The reason for it I suspect was that during the bailout some EUrocrat stood up and said "Look at those feckers! They don't even pay property tax, let them agree to bring that in first, then we'll talk" or else it's all part of a much deeper tax harmonisation conspiracy part of the great European Project to make the EU one big country.

dr.fuzzenstein

relax carry on wrote: »

What organisations deliberately set out to defraud people? Also individuals deliberately setting out to defraud people are committing an offence, have you informed the relevant authorities?

I think it's more the collusion of the state, big industry, the legal profession and regulatory authorities to deliberately skew the tax burden in favour of large, global corporations (who seem to pay little or no tax and certainly not as much as the rest of us) and very much not in favour of the average tax payer who gets burdened with ever more and higher taxes and charges (and what's left will be hoovered up by medical sector when you pay them €3k a month to be neglected in a nursing home) because the industry has the power and the lobby and the average Shmoe, well, doesn't.
One theory is that this is done to ensure that anything an individual or couple make over their lifetime will be hoovered up by the state and not get passed on to their children. That way you are ensured that the next generation are also wage-slaves who can be exploited via ever sh*ttier conditions with worse and worse paying yellow-pack jobs or zero hour contracts with absolutely no security whatsoever.

Pro Hoc Vice

Sh1tbag OToole wrote: »

Because Europe wants us to pay property tax.

It's a load of b0ll1x but this tax was foisted upon us by Europe and our TD's went along with it. The reason for it I suspect was that during the bailout some EUrocrat stood up and said "Look at those feckers! They don't even pay property tax, let them agree to bring that in first, then we'll talk" or else it's all part of a much deeper tax harmonisation conspiracy part of the great European Project to make the EU one big country.

Can you link to the EU legislation imposing property tax.

Sh1tbag OToole

Pro Hoc Vice wrote: »

I earn money and pay tax if I use that to buy a car I pay VRT and VAT, if I buy a TV I pay VAT my electricity is charged plus VAT my petrol is plus a number of taxes. I am not aware of any rule that says a person can't pay multiple taxes.

And when ya buy a beer you pay VAT, Excise, VAT on the Excise, Tax on the VAT, Exise on the VAT, Tax on the full amount, Tax on the Tax, VAT on the VAT, then the barman needs to make a few bob who pays PRSI, PAYE, Property tax, TV license, motor tax, USC and all the above when he buys a drink for himself.

Wanderer78

MarkAnthony wrote:

The only reason we have workers is because of the tax incentives for companies to come here. Contrary to the indoctrination in the Irish education system, we don't have world class education.

I personally believe large corporations are parasitic just like the financial sector. They aren't truly helping society at all. The tax burden has been largely placed on the shoulders of the workforce while wealth is accumulating at the very high tiers of our social and financial systems. This is completely unsustainable, the only problem is, nobody really knows what to do about it. It's credible that if we start taxing these industries more, that they'll leave. We probably have to approach this globally but that will probably be impossible. This will not be an easy task, but I do think it must be tackled immediately. The work force is being squeezed through taxation and debt. Completely unsustainable

Sh1tbag OToole

Pro Hoc Vice wrote: »

Can you link to the EU legislation imposing property tax.

It isn't legislation, part of the bailout deal

Geuze

armabelle wrote: »

jesus 33%! So you work all your life to buy a house for my kids so they have to pay back 33% of it when they inherit it? Surely that can't be right?

Do you by any chance know what kind of reliefs / exemptions there are?

33% on any amount over 280k per child beneficiary.

Many beneficiaries of wills pay zero CAT.

athtrasna

Moved from A&P, as is taxation discussion

Mod

PMBC

Sh1tbag OToole wrote: »

Because Europe wants us to pay property tax.

It's a load of b0ll1x but this tax was foisted upon us by Europe and our TD's went along with it. The reason for it I suspect was that during the bailout some EUrocrat stood up and said "Look at those feckers! They don't even pay property tax, let them agree to bring that in first, then we'll talk" or else it's all part of a much deeper tax harmonisation conspiracy part of the great European Project to make the EU one big country.

We had a property tax in the form of 'household rates' until that nice man Jack Lynch abolished the tax to win an election and put FF back in power. Well who would reject gifts except those who were wary of 'the Greeks bearing them! We are back where we were.

MarkAnthony

Wanderer78 wrote: »

I personally believe large corporations are parasitic just like the financial sector. They aren't truly helping society at all. The tax burden has been largely placed on the shoulders of the workforce while wealth is accumulating at the very high tiers of our social and financial systems. This is completely unsustainable, the only problem is, nobody really knows what to do about it. It's credible that if we start taxing these industries more, that they'll leave. We probably have to approach this globally but that will probably be impossible. This will not be an easy task, but I do think it must be tackled immediately. The work force is being squeezed through taxation and debt. Completely unsustainable

I don't necessarily disagree, however the OP is looking at it from the point of view of the individual. Granted there are huge macroeconomic problems, if they were on the path to being solved all it reduce the tax burden we face but it's unlikely it would reduce the number and type of taxes IMHO.

Sh1tbag OToole

PMBC wrote: »

We had a property tax in the form of 'household rates' until that nice man Jack Lynch abolished the tax to win an election and put FF back in power. Well who would reject gifts except those who were wary of 'the Greeks bearing them! We are back where we were.

What year were those brought in? As far as I remember those were fairly short lived as well, though I could be wrong

Wanderer78

MarkAnthony wrote:

I don't necessarily disagree, however the OP is looking at it from the point of view of the individual. Granted there are huge macroeconomic problems, if they were on the path to being solved all it reduce the tax burden we face but it's unlikely it would reduce the number and type of taxes IMHO.

Good points alright. I have major issues with our educational system as well but that's a discussion for another thread. We have to do something about taxation in this country. Families are being squeezed

regi3457

relax carry on wrote: »

What organisations deliberately set out to defraud people? Also individuals deliberately setting out to defraud people are committing an offence, have you informed the relevant authorities?

Many. Food companies, banks, investment funds, politicians. I mean do you know that they are pumping your chicken breast full of water and selling them to you but it is perfectly legal?

And no. No informing is neccesary, the "authorities" are quite happy with the current set-up.

Do you not read the news? Panama papers anyone?

andekwarhola

Because higher rates of general taxation are anathema to voters, especially those that pay very little of it.

So political parties pander to this to win elections and then immediately impose a raft of stealth taxes on the middle class to cover the gaping holes in the tax take required to pay for the full range of services we demand, especially those that respond violently to the concept of pay moderate amounts of tax on low or moderate incomes.

Pro Hoc Vice

Sh1tbag OToole wrote: »

It isn't legislation, part of the bailout deal

The bailout deal involved the IMF last I looked that was not a body of the EU. The Trokia has been blamed for a lot when it only set budget targets it was up to Ireland how it achieved same. It was lazy politicians who simply said to any difficult choice blame the EU.

KlausFlouride

Wanderer78 wrote: »

I personally believe large corporations are parasitic just like the financial sector.This is completely unsustainable, the only problem is, nobody really knows what to do about it. It's credible that if we start taxing these industries more, that they'll leave. The work force is being squeezed through taxation and debt. Completely unsustainable

The problem is starting to be tackled globally, the existing Corporation Tax rules on residency and so forth are being reviewed, and will change quite soon. In Ireland's case, it may be a case of be careful what we wish for. The likes of Google etc are not breaking the current tax rules, bear that in mind when politicians (who could change the laws) speak on the subject. Also, CT is paid on profits, not sales revenue which is often thrown around as the figure tax should be paid on, companies like Amazon made no profits for years, but ploughed back in money to build the business.

In Ireland, large corporations pay rates (a from memory 120k sq ft building paid c100k rates per annum) and employee PRSI @ 10.75%, so the headline CT rate is not the only tax they pay.

Large corporations in of themselves are not the problem, delinquent, irresponsible governments who have adopted a hands off attitude to any difficult issues and allowed the cost of living to get out of control are a much bigger factor (housing/health/pensions).

Sh1tbag OToole

Pro Hoc Vice wrote: »

The bailout deal involved the INF last I looked that was not a body of the EU. The Trokia has been blamed for a lot when it only set budget targets it was up to Ireland how it achieved same. It was lazy politicians who simply said to any difficult choice blame the EU.

I'd say the politicians didn't give much resistance anyway to bringing it in. Probably did all they could to keep the corporate multinational crowd happy.

12Phase

Because it's not income tax?

regi3457

Pro Hoc Vice wrote: »

The bailout deal involved the IMF last I looked that was not a body of the EU. The Trokia has been blamed for a lot when it only set budget targets it was up to Ireland how it achieved same. It was lazy politicians who simply said to any difficult choice blame the EU.

Nobody is lazy when it comes to making profit. People know what they are doing. Laziness is far more acceptable than this.

PMBC

All businesses pay 'Rates' to their Local Authority. The amount of 'Rates' that is imposed on them yearly depends on the 'Rateable Valuation' of the property. Each local authority sets a 'Rate' annually. It is also often referred to as the 'Rate in the Pound' or was before the Euro. Before property owners that were not businesses paid 'Rates'.

Wanderer78

KlausFlouride wrote: »

The problem is starting to be tackled globally, the existing Corporation Tax rules on residency and so forth are being reviewed, and will change quite soon. In Ireland's case, it may be a case of be careful what we wish for. The likes of Google etc are not breaking the current tax rules, bear that in mind when politicians (who could change the laws) speak on the subject. Also, CT is paid on profits, not sales revenue which is often thrown around as the figure tax should be paid on, companies like Amazon made no profits for years, but ploughed back in money to build the business.

In Ireland, large corporations pay rates (a from memory 120k sq ft building paid c100k rates per annum) and employee PRSI @ 10.75%, so the headline CT rate is not the only tax they pay.

Large corporations in of themselves are not the problem, delinquent, irresponsible governments who have adopted a hands off attitude to any difficult issues and allowed the cost of living to get out of control are a much bigger factor (housing/health/pensions).

not at all, its been made to look like these corporations are squeaky clean and that government are the bad guys. this isnt the case and theres many commentators explaining in great detail how that is. our governments do have a lot to answer for though but i think they are being dictated to mainly by the financial sector

use to work for a large american company. the financial manager told me that they ll never leave ireland due to our tax regime, even though that particular business has 'never' made a profit in its 30 odd years of being in our country! somethings wrong there! that particular business has produced very little in the last few years, has let some people go but has kept many on. most are just sitting around, cleaning and painting the place, and making it look like they are being trained, so that they can avail of training grants from the government. im sure theyre not the only business do this. it must be very easy to make it look like a business is making little or no profit

if we are starting to tackle corporation taxes globally, im not seeing it. theres so many loop holes in that game, it may never be solved. i believe our living costs have spiraled out of control largely due to behavior in our financial sectors, or as michael hudson calls, the 'fire' sector. this is a big problem of which again, nobody really knows how to tackle. its getting very complicated and very messy

KlausFlouride

Corporation Tax in the process of being looked at globally, the BEPS project. It's to revise the old OECD rules that came about in the 50s/60s when industries were simpler in terms of sales/headquarters/centres of production. There will be changes due to flagrant abuses in places like Luxembourg & so forth, as countries like the US is lose out on CT.

I'm don't see the reason behind "living costs have spiraled out of control largely due to behavior in our financial sectors". Even if the banks hadn't gone wallop in 2008 for instance, Ireland would have had to go to the IMF/EU for a bailout. The behaviour of banks/MNCs is often reprehensible, but they're doing what they're allowed to do by negligent governments, not just here but in the UK and US. Governments have intervened in the past to curb the worst excesses of capitalism (worker rights/pensions/paid holidays/capped working weeks), but increasingly they have absolved themselves of responsibility in this area. The goal of a business is to make money, the goal of a democratic government should be to grow a fair and just society, it's two entirely different sets of responsibilities.

Wanderer78

KlausFlouride wrote: »

Corporation Tax in the process of being looked at globally, the BEPS project. It's to revise the old OECD rules that came about in the 50s/60s when industries were simpler in terms of sales/headquarters/centres of production. There will be changes due to flagrant abuses in places like Luxembourg & so forth, as countries like the US is lose out on CT.

I'm don't see the reason behind "living costs have spiraled out of control largely due to behavior in our financial sectors". Even if the banks hadn't gone wallop in 2008 for instance, Ireland would have had to go to the IMF/EU for a bailout. The behaviour of banks/MNCs is often reprehensible, but they're doing what they're allowed to do by negligent governments, not just here but in the UK and US. Governments have intervened in the past to curb the worst excesses of capitalism (worker rights/pensions/paid holidays/capped working weeks), but increasingly they have absolved themselves of responsibility in this area. The goal of a business is to make money, the goal of a democratic government should be to grow a fair and just society, it's two entirely different sets of responsibilities.

some good points there alright, i particularly like and agree with your final point, but i think we in a very dangerous era whereby our financial sector is now dictating to our governments on how we should run our countries. handing our monetary systems over to a largely privately owned financial system is proven to be very dangerous and is causing serious problems for us all. our monetary systems should be publically owned and run for the greater good of society but this is not the case as it stands.

dar100

relax carry on wrote: »

What organisations deliberately set out to defraud people? Also individuals deliberately setting out to defraud people are committing an offence, have you informed the relevant authorities?

It's a lot of the people who make the laws, that are the problem.. who do you report them to? You cant be outside the law if your making the law

barneystinson

dar100 wrote: »

It's a lot of the people who make the laws, that are the problem.. who do you report them to? You cant be outside the law if your making the law

Welcome to democracy - you get the government (and the laws) the majority vote for. What's your alternative?

Sh1tbag OToole

barneystinson wrote: »

Welcome to democracy - you get the government (and the laws) the majority vote for. What's your alternative?

The last crowd famously lied about not bringing in property tax and then decided to bring it in anyway