Income tax increase for super rich - Can i hear a coherent argument against?

Mr. Presentable · 02-12-2011 10:44AM

OP, the top earners pay the most tax as it is.

The ones who are not paying their way are the low income people.

The system is simple really. The most tax is paid by the higher earners. The high earners are in a position to take their skills and taxes to another juristiction. Push them out and your tax take for the state will drop.

This simplistic "Oh he has a Merc he must be penalised" shugar has to stop. Stop looking at the other man and take a look at yourself - see what you can do to improve your lot, not how you can disimprove someone else's.

Alun · 02-12-2011 10:51AM

Mr. Presentable wrote: »

OP, the top earners pay the most tax as it is.

The ones who are not paying their way are the low income people.

Exactly, as has been posted many times over on the politics forum ...

reprazant · 02-12-2011 10:54AM

Liam Byrne wrote: »

Originally Posted by Thoie wrote:

Originally Posted by veryangryman wrote:

If you keep pushing people into poverty, eventually this will hit breaking point. 100K is more than well off. If you earned 110K for instance, and i took 10% of the 10K, im pretty sure youll still be able to afford that ivory backscratcher

We already take proportionally more from the higher earners, due to the way our tax system works.
Take three earners:
Adam earns 100k
Bob earns 40k
Charles earns 20k

Assuming they're all single PAYE employees you can use http://taxcalc.eu/ to work out how much tax they're paying as a percentage of their income.
Including PAYE, PRSI, USC:
Adam pays 41% of his income in tax
Bob pays 24% of his income in tax
Charles pays 10% of his income in tax

www.revenue.ie has more information on tax bands and credits if you're interested.

Does that take into account all the stealth taxes and levies ? And VAT ?

Because I reckon you'll find that a lot more of Charles' cash goes in tax than the others, even before the lawyers and advisors and the like find all the loopholes.

Really?

You think that somebody earning €40,000 does not pay any stealth taxes or levies?

That they hire accountants and lawyers to ensure that they pay less through loopholes? Seriously?

I would imagine that hiring lawyers and advisors and the like find all the loopholes would negate any savings them might make in said loopholes.

seamus · 02-12-2011 10:59AM

Liam Byrne wrote: »

Does that take into account all the stealth taxes and levies ? And VAT ?

Because I reckon you'll find that a lot more of Charles' cash goes in tax than the others, even before the lawyers and advisors and the like find all the loopholes.

Another fallacy. Do you think that high earners only spend €20k and put the rest in a savings account?

If someone is earning more money, then they are spending more money, therefore they pay more in stealth taxes and VAT than a lower earner.

The "lower earners pay proportionally more VAT" argument also doesn't stand up to scrutiny. A higher % of a lower earners spending will go on essentials - VAT-exempt goods and services. Whereas a higher proportion of a high-earners spending will go on luxury goods subject to full VAT. Lower earners also tend to be more able (and willing) to apply for various tax reliefs than higher earners. Therefore as a proportion of total income, lower earners most likely pay less VAT and other stealth taxes than higher earners.

I also see no logical reason why a higher earner should have to pay more tax just because they have more disposable income. They earned it.

stevenmu · 02-12-2011 11:01AM

We have a funny mentality in this country that the best way to solve poverty is by making rich people poor, when the obvious thing to do is to make poor people rich.

Osgoodisgood · 02-12-2011 11:11AM

veryangryman wrote: »

The idea of people over 100K having the balance taxed heavier (say 10% more) has been mooted and poo-poo'd in equal measure. However as an alternative to making people struggle on the low ends, id definitely be in favour of this idea.

What i cannot understand is those who are knocking it - i have yet to hear one good reason why we shouldn't put such a tax in. Can somebody (break it down for me cos im no expert in fairness) explain why its more progressive to stick it to the man, woman and child.

No im not saying that welfare system cant be changed etc but really when people are being screwed every six way from Sunday, surely this extra tax from the richer would go a long way to protecting them.

No, instead the PAYE higher rate has already been made kick in at 32K, so the average middle income worker has to foot the bill.

Why stop at 10% more? Why not 20%? Or 50%?
How dare they try to keep this money at all?
Criminals they are!

Redistribution.........equality.......rabble......Occupy........rabble.......rabble.......begrudgery.........

veryangryman · 02-12-2011 11:11AM

stevenmu wrote: »

We have a funny mentality in this country that the best way to solve poverty is by making rich people poor, when the obvious thing to do is to make poor people rich.

I dont see any rich people being taxed into poverty. Any working man or woman that i know who earned over 100K in the boom is still pretty wealthy all these years on.

Plenty of middle income people being sent the poverty direction mind you.

Doinker · 02-12-2011 11:12AM

professore wrote: »

Considering that it's possible for a family with one child to claim 90K in benefits with no tax and free medical expenses:

http://www.examiner.ie/ireland/call-for-welfare-pay-cap-as-couple-claim-90k-a-year-168808.html

then someone on 100K in the same situation is below the poverty line since they will pay quite a bit of tax.

I'm not trying to justify the amount in the above example, but I think the family in that example have four children, one with a serious medical condition - which is a bit different than a one child family.

veryangryman · 02-12-2011 11:12AM

Osgoodisgood wrote: »

Why stop at 10% more? Why not 20%? Or 50%?
How dare they try to keep this money at all?
Criminals they are!

Redistribution.........equality.......rabble......Occupy........rabble.......rabble.......begrudgery.........

Who the f**k is calling them criminals? Were talking about the option of putting food on peoples plates or letting better off people have more money than they can spend. Good for them that their that wealthy - fair deuce. But they can afford to help out

joseph brand · 02-12-2011 11:17AM

Big earners worry about money as much as low earners. One reason is this:

Man on 25K/ yr goes to bank to get mortgage. Banks says he can get mortgage of say, 200K. So he looks at houses for under 200K, but there's a spanky house on sale for 230K. He talks to the bank and they agree to 230K. (Now, he could have picked a house for around 180 to be on safe side)

Man on 100K/ yr goes to bank to get mortgage. Banks offers 900K mortgage. A lot of nice houses at this price but there's one with a heated driveway at a cool 1 million. He talks to the bank and they agree to the 1 million.

Both are beyond their means. They have been greedy and reached for as much as they can get. But if anything bad happens, they could easily find themselves in a world of excrement.

Liam Byrne · 02-12-2011 11:17AM

reprazant wrote: »

Liam Byrne wrote: »

Originally Posted by Thoie wrote:

Originally Posted by veryangryman wrote:

If you keep pushing people into poverty, eventually this will hit breaking point. 100K is more than well off. If you earned 110K for instance, and i took 10% of the 10K, im pretty sure youll still be able to afford that ivory backscratcher

We already take proportionally more from the higher earners, due to the way our tax system works.
Take three earners:
Adam earns 100k
Bob earns 40k
Charles earns 20k

Assuming they're all single PAYE employees you can use http://taxcalc.eu/ to work out how much tax they're paying as a percentage of their income.
Including PAYE, PRSI, USC:
Adam pays 41% of his income in tax
Bob pays 24% of his income in tax
Charles pays 10% of his income in tax

www.revenue.ie has more information on tax bands and credits if you're interested.

Does that take into account all the stealth taxes and levies ? And VAT ?

Because I reckon you'll find that a lot more of Charles' cash goes in tax than the others, even before the lawyers and advisors and the like find all the loopholes.

Really?

You think that somebody earning €40,000 does not pay any stealth taxes or levies?

That they hire accountants and lawyers to ensure that they pay less through loopholes? Seriously?

I would imagine that hiring lawyers and advisors and the like find all the loopholes would negate any savings them might make in said loopholes.

What are you on about ? Where did I say that ?

YES they pay them.

But do the basic maths : many stealth taxes are fixed amounts.

So they are a higher percentage of a lower wage than the higher one.

If you're on 20K the tv licence is nearly 1% of your ENTIRE GROSS INCOME

If you're on 200K it's only 0.1%

If you're on 20K you can guarantee that EVERY CENT gets spent, giving VAT of, let's say a 16% average.

If you're on 200K you can save or invest or get tax breaks - you certainly don't have to spend it all and incur 16% average sales tax.

Add in your bin charges (2% of 20K vs 0.2% of 200K) and we've just accounted for a 20% tax on less well paid.

And that doesn't even factor in fuel duties and other taxes which - if both are driving the same amount - are the same amount for both but a far higher PERCENTAGE for the lower-paid guy.

Anyone in between is a relative sliding scale.

Wake up, people! Ireland is NOT a low tax country.

Donal Og O Baelach · 02-12-2011 11:18AM

Paging "Dave the plumber" from last weeks liveline..

"..I earn 4000 euro a week and all I can afford is Weetabix for me dinner"

Thoie · 02-12-2011 11:19AM

veryangryman wrote: »

Who the f**k is calling them criminals? Were talking about the option of putting food on peoples plates or letting better off people have more money than they can spend. Good for them that their that wealthy - fair deuce. But they can afford to help out

Are you refusing to accept that they are already helping out, or do you genuinely think that increasing tax on high incomes will put food on the plates of lower income families?

seamus · 02-12-2011 11:21AM

Liam Byrne wrote: »

But do the basic maths : many stealth taxes are fixed amounts.

So they are a higher percentage of a lower wage than the higher one.

If you're on 20K the tv licence is nearly 1% of your ENTIRE GROSS INCOME

TV licence is a luxury spend, not a stealth tax.

Try again.

02-12-2011 11:22AM

It's a completely stupid begrudging idea. How about that one.

Frank Black · 02-12-2011 11:26AM

The Shinners seem to be the party most in favour of an additional tax on earnings above €100K.
If you don't want to go to the trouble of considering the implications of such a move, you can reasonably assume that if Sinn Fein think it's a good idea, the reality is that it's not.

It's a rule of thumb that's saved me loads of time having to read articles and discussion pieces.

Liam Byrne · 02-12-2011 11:30AM

joseph brand wrote: »

Big earners worry about money as much as low earners. One reason is this:

Man on 25K/ yr goes to bank to get mortgage. Banks says he can get mortgage of say, 200K. So he looks at houses for under 200K, but there's a spanky house on sale for 230K. He talks to the bank and they agree to 230K. (Now, he could have picked a house for around 180 to be on safe side)

Man on 100K/ yr goes to bank to get mortgage. Banks offers 900K mortgage. A lot of nice houses at this price but there's one with a heated driveway at a cool 1 million. He talks to the bank and they agree to the 1 million.

Both are beyond their means. They have been greedy and reached for as much as they can get. But if anything bad happens, they could easily find themselves in a world of excrement.

You've assumed that both were stupid. What about examples of both who weren't, but where both have been hit with a 10% pay cut and higher taxes ?

Liam Byrne · 02-12-2011 11:35AM

seamus wrote: »

Liam Byrne wrote: »

But do the basic maths : many stealth taxes are fixed amounts.

So they are a higher percentage of a lower wage than the higher one.

If you're on 20K the tv licence is nearly 1% of your ENTIRE GROSS INCOME

TV licence is a luxury spend, not a stealth tax.

Try again.

A "luxury" ? Ah FFS have we regressed that much into libertarian capitalist cloud cuckoo land that a friggin portable tv is a luxury ?

Maybe if we remove tvs from all those nasty low-paid people they won't be able to see the news and what's going on in the world? Maybe they won't realise that the rich who gambled and lost are creaming every cent without any care about fairness or ethics ?

And before you muddy the water - we're talking WORKING people here, not social welfare.

jester77 · 02-12-2011 11:36AM

Liam Byrne wrote: »

You've assumed that both were stupid. What about examples of both who weren't, but where both have been hit with a 10% pay cut and higher taxes ?

If you were not stupid then you would take that into account. Only an idiot would take out the biggest loan of their life without taking all permutations into account. As the loan would be over 30 years, then you can be guaranteed that at least 1 person in the couple will be out of work for an extended period of time during this 30 years (unemployment, pregnancy, ill health, raising children, etc) and the chances that both would be out of work would also be reasonable to assume. Plus you would calculate repayments with high interest rates, it doesn't take a genius to look at the history regarding interest rates and to see that the chances of them hitting the mid teens at some stage over 30 years is a given.

So a 10% cut and higher taxes is well within these limits.

sbsquarepants · 02-12-2011 11:36AM

Mr. Presentable wrote: »

OP, the top earners pay the most tax as it is.

The ones who are not paying their way are the low income people.

The system is simple really. The most tax is paid by the higher earners. The high earners are in a position to take their skills and taxes to another juristiction. Push them out and your tax take for the state will drop.

This simplistic "Oh he has a Merc he must be penalised" shugar has to stop. Stop looking at the other man and take a look at yourself - see what you can do to improve your lot, not how you can disimprove someone else's.

This is nonsense. People with good jobs who want to stay in Ireland will stay here, even if it means paying more tax. People with good jobs who want to leave will leave again regardless of tax. People who are forced to leave through unemployment, don't pay tax anyway.
The actual super rich, as in countless millions types, they don't pay tax anyway,- they can afford to pay people to manage their money for them to minimise or negate their taxes altogether.
Although i do admit there is a lot of begrudgery around too!

Bullseye1 · 02-12-2011 11:39AM

These so called rich are the people who create employment in this country. They do pay taxes and contribute to the money coming into the countries coffers.

We need to tackle the public expenditure first and foremost.

sbsquarepants · 02-12-2011 11:41AM

black francis wrote: »

The Shinners seem to be the party most in favour of an additional tax on earnings above €100K.
If you don't want to go to the trouble of considering the implications of such a move, you can reasonably assume that if Sinn Fein think it's a good idea, the reality is that it's not.

It's a rule of thumb that's saved me loads of time having to read articles and discussion pieces.

Pity it doesn't stop you sounding like a fool

Doctor_Socks · 02-12-2011 11:54AM

The arguments I have for it are:

It won't help this country at all, it'll provide a small amount of income for the government but won't account for the god knows how many other f*cuks ups this country has in its economic system.

Secondly, a lot of people who are rich are rich because they deserve to be! I'll take a large set of my friends and colleagues. They are on a nice salary at the moment, not €100K but still high compared to the average wage. All of these people have PhDs in the field of electronic engineering, they accomplished this by putting in huge amounts of hours into research, writing journal and conference publications and spending an extra 4+ years in college. They didn't spend time arsing about drinking constantly and pissing away their education, they studied and earned their qualification which came from spending 21+ years in education. I am currently working towards my PhD and have been putting in 10-12 hour days for the last two months to get a publication submitted before Christmas Day.

So to sum up, there are people who deserve to get their money and not have additional money taxed from them because people think that it's unfair that they have to pay the same tax rate as some one who makes a considerable amount more then them.

Sorry for the rant, but it really annoys me when someone who dropped out of secondary school and is now on the dole because they didn't care enough about their education in their youth, complains about why rich people shouldn't be taxed more!

02-12-2011 11:59AM

Is there any other country in the world where people spout so much shlt while thinking they know what they're talking about?

Gophur · 02-12-2011 12:01PM

black francis wrote: »

The Shinners seem to be the party most in favour of an additional tax on earnings above €100K.
If you don't want to go to the trouble of considering the implications of such a move, you can reasonably assume that if Sinn Fein think it's a good idea, the reality is that it's not.

It's a rule of thumb that's saved me loads of time having to read articles and discussion pieces.

I second that. This is the Party which is absolutely clueless when it comes to discussing Economics. Witness Michael McDowell's absolute destruction of Gerry Adams in the Gen Election debate of 2007.

Their Finance spokesman is an Engineering Technician who, falsely represented himself as an Engineer.

They also have Mary Lou. Mary Lou, who never seems to link two coherent sentences together and whose knowledge of economics would be down with the lowest.

€100k p.a. salary is not super-rich. At that level you are already being fleeced every which way. The scope for further taxes is very limited.

I had to laugh when someone described proposed medical charges as being a tax on the poorest section of society. By their very nature, they are a tax on the wealthier section of society.

Frank Black · 02-12-2011 12:03PM

Deleted User wrote: »

Is there any other country in the world where people spout so much shlt while thinking they know what they're talking about?

Burundi

Liam Byrne · 02-12-2011 12:04PM

Doctor_Socks wrote: »

The arguments I have for it are:

It won't help this country at all, it'll provide a small amount of income for the government but won't account for the god knows how many other f*cuks ups this country has in its economic system.

Secondly, a lot of people who are rich are rich because they deserve to be! I'll take a large set of my friends and colleagues. They are on a nice salary at the moment, not €100K but still high compared to the average wage. All of these people have PhDs in the field of electronic engineering, they accomplished this by putting in huge amounts of hours into research, writing journal and conference publications and spending an extra 4+ years in college. They didn't spend time arsing about drinking constantly and pissing away their education, they studied and earned their qualification which came from spending 21+ years in education. I am currently working towards my PhD and have been putting in 10-12 hour days for the last two months to get a publication submitted before Christmas Day.

So to sum up, there are people who deserve to get their money and not have additional money taxed from them because people think that it's unfair that they have to pay the same tax rate as some one who makes a considerable amount more then them.

Sorry for the rant, but it really annoys me when someone who dropped out of secondary school and is now on the dole because they didn't care enough about their education in their youth, complains about why rich people shouldn't be taxed more!

Arrogant and condescending bull****.

You do realise that there are LOADS of people in between your friends and boozy dropouts ?

Or maybe they don't cover real life scenarios in your PhD curriculum ?

02-12-2011 12:04PM

black francis wrote: »

Burundi

At least if they're spouting shlt, they've valid reason to.. Being a poor country and all.

bnt · 02-12-2011 12:17PM

foxyboxer wrote: »

I like this analogy....

There's a flaw in the analogy, however: it assumes they're all drinking beer. The rich people would be drinking champagne and cognac, which cost more. It would be unjust to make rich people pay more for the same products and services as everyone receives: the idea is to make them pay more because they take more. Which they do - not just directly, but indirectly too.

For example: Richard Branson probably hasn't seen the inside of a NHS Hospital in 40 years, unless he was visiting someone. So he hasn't benefited directly from the NHS. He has benefited indirectly, however, through his UK employees. Unless they all have comprehensive health insurance, which I seriously doubt, they've used the NHS at some point, and Virgin has benefited. The same is true of the roads, the railways, the education system, the skies, natural resources like water, and the general benefit of operating in a civilised, governed country. No business can operate in an anarchy, and making a country "work" costs money.

The question is: how much, and is it fair? What if all Virgin employees do receive full private health insurance? Then it's not fair for them to pay for the NHS too. If they use the railway system, they pay for it - and in the UK, that's a lot. Ditto for the skies, which are managed by the Civil Aviation Authority, paid for through airport charges. It's not fair to make people or businesses pay for the same things twice, even if they are rich. The problem is in determining just how rich people do benefit from the taxes they pay, and whether they get a fair deal. If it's obvious they're not, then they tend to leave the country and take their money with them. It's possible to go too far in the other direction, too.

mconigol · 02-12-2011 12:25PM

People who earn less work harder?

Income tax increase for super rich - Can i hear a coherent argument against?

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