Income Distribution & Tax Take


#61

Low paid? Irish tax system is more friendly than other countries

irishtimes.com/business/eco … -1.3545569


#62

How the Irish Left would squeal if we brought in type German tax rates :slight_smile:


#63

Would love if you could share the link. No joy here.


#64

revenue.ie/en/corporate/inf … tions.aspx


#65

That’s where I looked :smiley:

Couldn’t find an age distribution…


#66

Pm sent


#67

As spotted by bokonon, Revenue has published individual gross earning stats for the first time.

Reddit discusses it here
reddit.com/r/ireland/commen … r/e4mo5h8/

Irish Times have it here

Are you a high income earner if you are on €80,000 a year?
irishtimes.com/business/per … -1.3605299


#68

So over 150k and you are in the 1%, thought it would be higher


#69

Would I be correct in thinking that this is only income that is being listed, while excluding all the other benefits that high earners get.


#70

one would assume its reported earnings as per P60s?


#71

In Dublin, definitely not.
I’d say €60,000 is treading water.
€80,000 isn’t too far away from that.

The key question is, what’s €80,000 after-tax ?
ie.thesalarycalculator.co.uk/salary.php

€51,600 if single.
€55,050 if married 1 income
€60,159 if married 2 incomes
€52,400 if single (parent) with a family


#72

What’s this “married 2 incomes” stuff? Is it 2x 40k.?


#73

That’s still a pretty tidy disposable income.

Assuming €2K pcm rent or mortgage for a single person (not at all painful, since it allows for a fair sized home of one’s own in the inner to middle suburbs, even in Dublin), that allows €2300 pcm net. By my reckoning and experience, €800 pcm of disposable spending after rent gives a perfectly comfortable life and €1200 is absolute sybaritic luxury. Even the latter allows a net profit of 1100 pcm in the bank and that’s before we even think about the savings that come from the tax advantages of stuffing your pension fund.
If you’re happy to live with the (very decent) €200 pw discretionary spending, you’ll be saving €17200 pa on a gross salary of €80K pa.

€60K a year is not treading water, unless by “treading water” you mean stuffing your pension fund with as much as it can hold, paying the rent on a comfortable home and then banking as much as you spend after that.

“Treading water” comes somewhere around €38-40K. A modestly comfortable life, with an average pension contribution starts at about €45K. At €55k, you can live very comfortably, pile as much as the law allows into your pension fund and still start to save a tidy sum from your net income.

The transition from working poor to comfortably affluent takes place over a remarkably narrow range and the difference between “just about managing” and “sod it, I’m too rich to care” is only about €20K pa. It’s almost like throwing a switch.

Our tax system is also progressive, in that the rich pay a greater fraction of their income than the poor, but like the example above, it is similarly also far from proportionate, in that the transition from a very low to a fairly high effective tax rate is also like throwing a switch, while the transition from a fairly low to a moderately high marginal rate is even more abrupt. Once you’re on €55K pa and stuffing your pension fund as much as the government allow, everything above that is pure profit. The government will raise your marginal tax rate pretty swiftly to reduce that profit, but it’s still profit, nonetheless.

All that said, rents are still ridiculous and there are lots of people in Dublin earning €25-35K gross. Heaven only knows how they manage. :frowning:


#74

Is this the Dublin version of the Monty Python Yorkshiremen sketch? :smiley:
€800 pcm wouldn’t even pay the bills, and I wouldn’t consider myself a spendthrift. My definition of “perfectly comfortable” would be €50k pa net after tax, with no rent or mortgage. “Luxury” would be a fair bit beyond that.


#75

€800 pcm is the absolute minimum people should be thinking about saving for long term pensions etc.


#76

Sure, but the point I’m making is that on €80K, you can live comfortably, stuff your pension full and still save plenty from your post tax income. The point at which you can start saving out of post tax income, on top of generous pension provision comes at about €55K.

I have no idea how people on €35K manage.


#77

You live in a council house (if you’re lucky), you drive bangers on which you risk not paying tax, you don’t go on holidays, you’ve no savings or pension. If you’ve a family you get family income support and other supports, the community welfar officer knows your name. It can be fairly precarious.


#78

Low income worker? Ireland has smallest tax burden for low paid

irishtimes.com/business/per … -1.3633502


#79

I don’t mind a progressive tax system but what I do mind is the absolute lack of recognition and outright denial that we have a very progressive tax system in Ireland but almost everyone and virtually all of the politicians especially the socialist.

Solidarity my arse, it’s the usual crap, you earn more than me so you should pay more tax.


#80

I have no idea either. Those in Dublin on that salary must have no quality of life whatsoever.