Tax social welfare at same rate as PAYE

Grudle · 27-08-2012 02:12PM #1

What would people think of social welfare being taxed at the same rate as PAYE workers?

We hear about these stories of people getting €25-€30k or more in social welfare per annum, well then why not let them still get this but get taxed on this at the same rate as a PAYE worker earning this amount would? Obviously exclude payments that employed people are also entitled to such as childrens allowance, but for amounts such as rent allowance, job seekers benefit etc. let the tax be paid at the applicable rate.

This will cut the net outlay in social welfare and bring people on social welfare into the tax net at the same level as people who are employed and earning similar amounts.

poeticseraphim · 27-08-2012 02:23PM

The Govt is going to take revenue from it's own money?

There would be less administrative costs if there was simply a cut by a similar amount.

Introducing better means testing and a cut makes more sense.

Grudle · 27-08-2012 02:27PM

poeticseraphim wrote: »

The Govt is going to take revenue from it's own money?

There would be less administrative costs if there was simply a cut by a similar amount.

Introducing better means testing and a cut makes more sense.

Same principal as taxing civil servants, no?

Valetta · 27-08-2012 02:27PM

Most social welfare payments are already taxable.

relax carry on · 27-08-2012 03:07PM

List of taxable payments if you are interested.

http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/claiming_a_social_welfare_payment/taxation_of_social_welfare_payments.html

Farmer Pudsey · 27-08-2012 03:21PM

The level of tax that would be raised would be limited. Single persons allowance is about 8K a year and the PAYE allowance is also about 8K. The single Adult over 25 rate is 188 about 9K so not tax even if paye allowance was not allowed the total would be 200.

Even a couple would have to have 32K in social welfare before they would be taxed. The realit is that alot of benifits on welfare are on the side. Lower rate for Local Authority housing, rent allowance, back to school allowance, fuel allowance, reduce rate into GAA/Soccer matches.

It would also be an administartive nightmare and would again effect the recipent of CA on low means the most. The reality is that our welfare rate works out way better for family's than the minimum wage. The only bills you some have to worry about are the ESB, Phone, LA rent and they often let these build up and get supplmentry welfare/Charity's to pick them up.

dvpower · 29-08-2012 09:42PM

Good idea. Some benefits are already taxed - as per link above.
Everyone should pay some income tax, even if it's just 1c.

sligoface · 29-08-2012 10:21PM

The only bills you some have to worry about are the ESB, Phone, LA rent and they often let these build up and get supplmentry welfare/Charity's to pick them up.

um, no they don't. the vast majority of people on social welfare pay their rent and bills like everyone else. i myself have to make sure to put aside a bit of my SW payment each week because otherwise I'd starve for two weeks when my esb bill came in.

as for rent, many like myself can't even get rent allowance due to the limits on rents being very low and the fact that you can only get it if you are in a place for six months paying all the rent yourself and can prove that a loss of income has made it impossible for you to continue paying it. so you have to pay full rent out of your e188. like the OP, who has notions that people on SW are getting over 20k per year, you really don't know what the reality is.

another one of these 'hang the dolie's' threads. i realize many people in work are feeling the squeeze, but taxing an amount deemed to be the minimum one can realistically survive on? even for people whose dole entitlements are directly from their tax contributions from when they had work? how is that going to help you? it won't make things more fair, though you might think that. it will just make people who are under serious pressure for basic costs of food/shelter.

we need jobs for people on the dole, not taxes. and it's well documented that the filthy rich corporations in this country are the biggest tax dodgers and the amounts they owe would dwarf any amount a tax on SW would achieve.

btw, there was 390 jobs lost this week at target express with basically no warning. any one could end up on the dole today, because employees are just a number nowadays. think about that before you start trying to come up with ridiculous schemes - you could be next. but if you really feel strongly about it, go down to the bus yard where the target express lads are picketing over the unfair manner of their job losses, and explain how you think their dole should be taxed. i'd like to see how you get on.

Farmer Pudsey · 29-08-2012 10:49PM

sligoface wrote: »

um, no they don't. the vast majority of people on social welfare pay their rent and bills like everyone else. i myself have to make sure to put aside a bit of my SW payment each week because otherwise I'd starve for two weeks when my esb bill came in.

as for rent, many like myself can't even get rent allowance due to the limits on rents being very low and the fact that you can only get it if you are in a place for six months paying all the rent yourself and can prove that a loss of income has made it impossible for you to continue paying it. so you have to pay full rent out of your e188. like the OP, who has notions that people on SW are getting over 20k per year, you really don't know what the reality is.

another one of these 'hang the dolie's' threads. i realize many people in work are feeling the squeeze, but taxing an amount deemed to be the minimum one can realistically survive on? even for people whose dole entitlements are directly from their tax contributions from when they had work? how is that going to help you? it won't make things more fair, though you might think that. it will just make people who are under serious pressure for basic costs of food/shelter.

we need jobs for people on the dole, not taxes. and it's well documented that the filthy rich corporations in this country are the biggest tax dodgers and the amounts they owe would dwarf any amount a tax on SW would achieve.

btw, there was 390 jobs lost this week at target express with basically no warning. any one could end up on the dole today, because employees are just a number nowadays. think about that before you start trying to come up with ridiculous schemes - you could be next. but if you really feel strongly about it, go down to the bus yard where the target express lads are picketing over the unfair manner of their job losses, and explain how you think their dole should be taxed. i'd like to see how you get on.

If you read my post I made the point that it was "some" not all. And yes I know that I could be next however workers are again being targeted by the property tax and fuel has added an inordionate cost to those traveling to work. In my own case since 2008 I have suffered about a 35% cut in take home pay. Between work and farming I work about a 60 hour week. I am not looking for any medals but at this stage it is getting to a fight for survival.

If you read my posts I have never advoctated taxing welfare it is a waste of time doing it however I do believe that the welfare system is generous in the extreme and that there a disentive for some people to go back to work. It is probally true to say it would not pay most recipents to go back on minimum wage work.

ArtSmart · 29-08-2012 10:59PM

Farmer Pudsey wrote: »

If you read my post I made the point that it was "some" not all. And yes I know that I could be next however workers are again being targeted by the property tax and fuel has added an inordionate cost to those traveling to work. In my own case since 2008 I have suffered about a 35% cut in take home pay. Between work and farming I work about a 60 hour week. I am not looking for any medals but at this stage it is getting to a fight for survival.

If you read my posts I have never advoctated taxing welfare it is a waste of time doing it however I do believe that the welfare system is generous in the extreme and that there a disentive for some people to go back to work. It is probally true to say it would not pay most recipents to go back on minimum wage work.

Ah, for a moment i thought you were offering something real.

personally i do think all should be taxed - to allow people to work part time, or on short term contracts/ basis the easiest and most efficient way to facilitate re-entry to the work force when opportunities arise. At the moment, your are severely penalised for dipping the toe back in to any half opportunities - which helps no one. No one at all.

Also for those lucky enough to actually fina a FT job, an easing in period should be facilitated. again, the current system is a 'sink or swim' approach - which scares people with families etc, who see it as risking guaranteed income, against job uncertainty. if they knew that they'd be covered if things went wrong, they'd be more likely to take that risk. at the moment, if you sing off, getting back into the system is a nightmare - no joke for a family man - or any one.

the issue, sadly, is still a moral one for the deciders (ie, it will encourage dependency - the reality is it will encourage taking thew 'risk' of working), though that might change

ArtSmart · 29-08-2012 11:05PM

Germany got away with a system similar to what i'm advocating, though the limit is a year (which is fine) so the EU can't really complain. besides, we could argue, rather cheekily, that we still have political and economic sovereignty.

Cheerful Spring · 30-08-2012 03:42AM

Grudle wrote: »

What would people think of social welfare being taxed at the same rate as PAYE workers?

We hear about these stories of people getting €25-€30k or more in social welfare per annum, well then why not let them still get this but get taxed on this at the same rate as a PAYE worker earning this amount would? Obviously exclude payments that employed people are also entitled to such as childrens allowance, but for amounts such as rent allowance, job seekers benefit etc. let the tax be paid at the applicable rate.

This will cut the net outlay in social welfare and bring people on social welfare into the tax net at the same level as people who are employed and earning similar amounts.

if people are getting 30,000 euros from the welfare no wonder the welfare bill is so high. Those kind of payments need to stop.

stoneill · 30-08-2012 04:00AM

Cheerful Spring wrote: »

if people are getting 30,000 euros from the welfare no wonder the welfare bill is so high. Those kind of payments need to stop.

It's not people scamming the system, it's the system allowing people to claim this. Don't tar everyone with the one brush.
If someone is getting 20-30K on SW then someone in the SW office should be sacked for allowing this to happen.

padser12345 · 30-08-2012 05:13AM

Grudle wrote: »

What would people think of social welfare being taxed at the same rate as PAYE workers?

We hear about these stories of people getting €25-€30k or more in social welfare per annum, well then why not let them still get this but get taxed on this at the same rate as a PAYE worker earning this amount would? Obviously exclude payments that employed people are also entitled to such as childrens allowance, but for amounts such as rent allowance, job seekers benefit etc. let the tax be paid at the applicable rate.

This will cut the net outlay in social welfare and bring people on social welfare into the tax net at the same level as people who are employed and earning similar amounts.

Tend to agree with your sentiment .....but your opening line answers your questions "they are just stories"!
The people your talking about are probably the most extreme cases of benefit....most get €188 + a medical card + fuel allowance if your lucky. That's about €11k PA

padser12345 · 30-08-2012 05:34AM

Farmer Pudsey wrote: »

If you read my post I made the point that it was "some" not all. And yes I know that I could be next however workers are again being targeted by the property tax and fuel has added an inordionate cost to those traveling to work. In my own case since 2008 I have suffered about a 35% cut in take home pay. Between work and farming I work about a 60 hour week. I am not looking for any medals but at this stage it is getting to a fight for survival.

If you read my posts I have never advoctated taxing welfare it is a waste of time doing it however I do believe that the welfare system is generous in the extreme and that there a disentive for some people to go back to work. It is probally true to say it would not pay most recipents to go back on minimum wage work.

How arrogant and biased can people get by assuming that people on the Dole don't have mortgages and that fuel prices don't affect them either!
I don't know whether you let it slip or not deliberately ....you say you farm? Don't start a discussion you may regret!

padser12345 · 30-08-2012 06:30AM

Twenty billion on social welfare - is twenty billion that goes directly back into the "Irish" economy. That's all the money that keep SMES, Landlords, Shops, Doctors Etc. In constant business. All the VAT returns in those transactions go back to the Government. That's part of what the working public get back in return...but more so, a standard of people who create the better level of society that we are all accustomed to! They don't get holidays or have private pensions or even remotely consider that one day their kids will go to private school.
People on the dole are "notionally" taxed already, insofar as "prospect". As opposed to the worker for example that could do overtime to augment their standard of living! What about parading your misery on the main street of your town while you sign-on? How in-dignifying is that??

If you think it's soooo good come join the party!

Sleepy · 30-08-2012 08:45AM

padser12345 wrote: »

Twenty billion on social welfare - is twenty billion that goes directly back into the "Irish" economy.

Not in any fashion that we can benefit from economically. We're a small, open, economy. Money spent on any of the following results in money leaving the Irish economy:

petrol/diesel
home heating oil
cars / car parts
imported foods (e.g. peppers, bananas, oranges, courgettes, even potatoes!)
electronic goods
children's toys
books
most clothing
wine
tea
coffee
computer hardware
medicines
tobacco

And that's just what I can come up with off the top of my head.

ardmacha · 30-08-2012 10:32AM

They don't get holidays

Working away 24/7/365, are they?

Dirk Gently · 30-08-2012 10:39AM

Sleepy wrote: »

And that's just what I can come up with off the top of my head.

All of which are bought by Irish companies and sold on to the Irish public to maintain jobs in our economy. If your list wasn't of economic benefit the only things sold here would be aran sweaters and home produced food.

Dannyboy83 · 30-08-2012 11:04AM

ardmacha wrote: »

Working away 24/7/365, are they?

They get 2 weeks paid holidays (payment is made upon return)
http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/claiming_a_social_welfare_payment/going_abroad_and_social_welfare_payments.html

Longer holidays can be taken, but they're unpaid.

Sleepy · 30-08-2012 11:08AM

Dirk Gently wrote: »

All of which are bought by Irish companies and sold on to the Irish public to maintain jobs in our economy. If your list wasn't of economic benefit the only things sold here would be aran sweaters and home produced food.

Yes, but by the very fact that they have to import these products, it means that not all of that money is going to the Irish economy invalidating any attempt to boost our economy via the multiplier effect.

Ireland is simply too dependent on imports for Keynesian "borrow and spend" tactics to work. We need to focus our efforts on cutting our cloth to suit our measure and increasing exports. Getting our budget balanced is stitching the wound: increasing exports is the slow healing that will create the employment we so badly need.

Neil3030 · 30-08-2012 11:20AM

padser12345 wrote: »

Twenty billion on social welfare - is twenty billion that goes directly back into the "Irish" economy. That's all the money that keep SMES, Landlords, Shops, Doctors Etc. In constant business. All the VAT returns in those transactions go back to the Government. That's part of what the working public get back in return...but more so, a standard of people who create the better level of society that we are all accustomed to! They don't get holidays or have private pensions or even remotely consider that one day their kids will go to private school.
People on the dole are "notionally" taxed already, insofar as "prospect". As opposed to the worker for example that could do overtime to augment their standard of living! What about parading your misery on the main street of your town while you sign-on? How in-dignifying is that??

If you think it's soooo good come join the party!

I would see it as a double tax on workers. A 20bn government supplement to consumer spending would very likely drive up prices. So people have their pay taxed and then have to pay more for their necessities.

Not much overtime kicking around these days aswell.

Hill Bicks · 30-08-2012 11:51AM

Dannyboy83 wrote: »

They get 2 weeks paid holidays (payment is made upon return)
http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/claiming_a_social_welfare_payment/going_abroad_and_social_welfare_payments.html

Longer holidays can be taken, but they're unpaid.

Holidays to where??? 188 euro doesnt leave much spending money!

Facts are to get 25-30K on the welfare you would have to have at least four kids and be in rented accomadation. The income from child benefit, rent allowance ect would probably bump the payments up to some figure near this. But the massive numbers of construction workers and those in associated businesses that have joined the dole queues in the last four years more then likely also bought houses and have restricted the size of their family due to the fall in income, most would not see having more kids as a way to live a comfortable life and would rather get back to work and having some proper money in their pocket then to be relying on handouts and have to be branded lazy by those who have been lucky enough not to have been severely affected by the downturn.

Dannyboy83 · 30-08-2012 01:49PM

Hill Bicks wrote: »

Holidays to where??? 188 euro doesnt leave much spending money!

Yep, wouldn't dispute that at all, just stating that there is a provision for holidays.

Average private sector wage is €611 per week and few people seem to be able to go on holidays this year so I can't see many SW recipients being able to afford it.

(Didn't refer to public sector wage as we know the average distorted by the Lord/Serf dichotomy in their salaries.)

padser12345 · 30-08-2012 02:20PM

Sleepy wrote: »

Not in any fashion that we can benefit from economically. We're a small, open, economy. Money spent on any of the following results in money leaving the Irish economy:

petrol/diesel
home heating oil
cars / car parts
imported foods (e.g. peppers, bananas, oranges, courgettes, even potatoes!)
electronic goods
children's toys
books
most clothing
wine
tea
coffee
computer hardware
medicines
tobacco

And that's just what I can come up with off the top of my head.

Point taken & insofar as your list not being exhaustive....but Irish produce is also bought....and yes we rely on a lot of external factors to survive.
If your talking 'strictly' economically beneficial....then, what do we get in return from the Public Sector....they also buy these things, but even more blatantly buying foreign holidays and apartments.Etc.

Sleepy · 30-08-2012 02:26PM

padser12345 wrote: »

Point taken & insofar as your list not being exhaustive....but Irish produce is also bought....and yes we rely on a lot of external factors to survive.
If your talking 'strictly' economically beneficial....then, what do we get in return from the Public Sector....they also buy these things, but even more blatantly buying foreign holidays and apartments.Etc.

uhm, public services?

padser12345 · 30-08-2012 02:40PM

Neil3030 wrote: »

I would see it as a double tax on workers. A 20bn government supplement to consumer spending would very likely drive up prices. So people have their pay taxed and then have to pay more for their necessities.

Not much overtime kicking around these days aswell.

If Irish Importers buy in bulk...they get it somewhat cheaper and I assume it is passed on to Musgraves or the like....and so on. And, I understand the constraints/logic of Employers when it comes to hiring P/T or Temp. "experienced" staff....but in some ways you put someone else on the Dole, when you do overtime. It's not directly a matter for the Employee, I know' but you have nonetheless a luxury!

padser12345 · 30-08-2012 02:42PM

Sleepy wrote: »

uhm, public services?

I know...I know...I hit the central nerve there' sorry!

padser12345 · 30-08-2012 02:49PM

Dannyboy83 wrote: »

They get 2 weeks paid holidays (payment is made upon return)
http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/claiming_a_social_welfare_payment/going_abroad_and_social_welfare_payments.html

Longer holidays can be taken, but they're unpaid.

Correct, and the last time I went foreign, was for a Funeral, and had to be 'excused'!

jimmycrackcorm · 30-08-2012 11:51PM

Hill Bicks wrote: »

Holidays to where??? 188 euro doesnt leave much spending money!

What about all those living at home with parent(s) handing over €50 p/W for their keep.

This week I got stung for €450 for back to school (before the "voluntary" school contribution and another €280 in medical bills. This would be covered by social welfare. This and more simply says that there is an imbalance between working and being on s/w.

It simply astounds me to see not only how many people on social welfare benefits have Sky TV but who regard poverty as being not able to afford it.

paddy147 · 30-08-2012 11:58PM

Well at least we now know why a few FF ministers stepped down/retired on "health grounds".

All the politicians need is a sick note from their GP,and they get to retire with double pay/double pension.

A certain minister supposedly has very bad and cronic back problems and retires on health grounds,yet suddenly hes well able to play rounds of golf all day long.

Isnt that just amazing???

Ireland is a great country indeed and has a great bunch of politicians indeed.......Rich get richer and the poor get poorer.

PS-I wonder will any FG/Labour politicians try this trick in the next few years??

Tax social welfare at same rate as PAYE

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