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Thread: Should Income Tax above 1 Million be lower........

  1. #1

    Default Should Income Tax above 1 Million be lower........

    Seems a strange thing to suggest but given that Individuals earning in excess of 1M tend to spend a proportion of their income on tax advisers and also on legal tax avoidance schemes then perhaps its time to look at it in a different way.

    Rather than attempting to tax high earners more and more above a certain figure which is regressive and ensures rather that the tax take going up the only people to benefit are tax advisers.

    Income above 1 Million gets taxed at 5% and Income above 5 Million at 2.5%.

    No doubt the usual suspects will demand anybody earning at that level should give all their money up but as taxation rates get higher you collect less so why not try a different way as less incentive to avoid tax on a higer income when you pay less tax than the cost of your advisers.

  2. #2
    Ramps
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    Quote Originally Posted by odie1kanobe View Post
    Seems a strange thing to suggest but given that Individuals earning in excess of 1M tend to spend a proportion of their income on tax advisers and also on legal tax avoidance schemes then perhaps its time to look at it in a different way.

    Rather than attempting to tax high earners more and more above a certain figure which is regressive and ensures rather that the tax take going up the only people to benefit are tax advisers.

    Income above 1 Million gets taxed at 5% and Income above 5 Million at 2.5%.

    No doubt the usual suspects will demand anybody earning at that level should give all their money up but as taxation rates get higher you collect less so why not try a different way as less incentive to avoid tax on a higer income when you pay less tax than the cost of your advisers.
    What people usually ignore is the most damaging effect of high (progressive) taxes on any high level of income: it causes the rich to "hid" money from the taxman, in unproductive shelters.

    A flat tax on all income would make redundant the techniques used by tens of thousands of scoundr...I mean tax lawyers who are currently employed in a never ending game of hide-and-seek with revenue services all over the world.

  3. #3

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    Quote Originally Posted by Ramps View Post
    What people usually ignore is the most damaging effect of high (progressive) taxes on any high level of income: it causes the rich to "hid" money from the taxman, in unproductive shelters.

    A flat tax on all income would make redundant the techniques used by tens of thousands of scoundr...I mean tax lawyers who are currently employed in a never ending game of hide-and-seek with revenue services all over the world.
    It would be a win win solution with a much clearer tax code, but then there are a lot of vested interests who don't want to see that.
    "If we can but prevent the government from wasting the labours of the people, under the pretence of taking care of them, they must become happy." - Thomas Jefferson

  4. #4
    Politics.ie Member firefly123's Avatar
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    Or we could close the loopholes. Y'know with laws and stuff. Like.
    Life is hard
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  5. #5
    Ramps
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    Quote Originally Posted by firefly123 View Post
    Or we could close the loopholes. Y'know with laws and stuff. Like.
    More laws...yes, that's exactly what we need: more civil servants to come up with more laws, and more lawyers to show more people how to get round them.

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    I actually do agree with you. Penal Tax rates are seriously becoming a disincentive to work harder and earn more. Maybe not reduce the tax rates for such high earners down so low, bu perhaps drop back again to standard rate at a certain point. And I also think proprietors of realtively small businesses, who are the backbione of the country, and provide the vast majority of jobd should get some sort of either extra tax allowance, or a small rate reduction (say 2% off the top rate) for each person they employ up to say 15. So many of the proprietors are self employed, who work very long hours, and take all the risks, for very little reward. They are seriously penalised for being in any way successful, and actually pay more tax than an employee on the same income, as they don't get the PAYE tax allowance.
    And they (the business) are paying vast sums in PRSI for the employees who get benefits when the business folds up, while they have no safety net, and get nothing. They have to be destitute to get state help - the employees are supported for 15 months or so.

  7. #7

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    Quote Originally Posted by Ramps View Post
    What people usually ignore is the most damaging effect of high (progressive) taxes on any high level of income: it causes the rich to "hid" money from the taxman, in unproductive shelters.

    A flat tax on all income would make redundant the techniques used by tens of thousands of scoundr...I mean tax lawyers who are currently employed in a never ending game of hide-and-seek with revenue services all over the world.
    Which is really where coming from as if earn €10 M a year and declare it you pay
    €491k on 1st Million
    €200k from €1-5 Million
    €125k from €5-10 Million

    Yup its 8.2% on €10 M BUT its at the top end where the state loses out anyway and IF you require a minimum residency which should add in a benefit from consumption tax.

  8. #8
    FunkyMonkey
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    50%

  9. #9
    Politics.ie Member firefly123's Avatar
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    Quote Originally Posted by Ramps View Post
    More laws...yes, that's exactly what we need: more civil servants to come up with more laws, and more lawyers to show more people how to get round them.
    Ah yes! I remember! It was all that over regulation that caused the problem in the first place! If only the lads had been given a free hand without those silly rules. Sure we would all be in clover!
    Life is hard
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  10. #10

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    Quote Originally Posted by firefly123 View Post
    Or we could close the loopholes. Y'know with laws and stuff. Like.
    And you wonder why people will spend €100k on tax lawyers when if easy there is no reason to do so.

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