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Taxation

What income changes arose from the tax and benefit measures taken in Budget 2020? What are the effective tax rates now for different levels of income, and how do they compare with effective rates over time? Click here to see.

Policy Coherence means making sure that the goals of one policy, or set of policies, does not conflict with another. Here are some areas where Ireland performs particularly badly in this regard.

In the Sustainability edition of our National Social Monitor,  we assess whether current policy on sustainability encompasses the three pillars of environment, society and economy and make proposals on how to transition towards a sustainable future. 

Social Justice Ireland welcomed the decision to tax windfall gains from re-zoned land in 2010 and strongly condemned its removal five years later as one of the most retrograde policy initiatives in recent years. Government should bring back the tax on windfall gains from re-zoned land in Budget 2020.

Budget 2020 is the ideal time to reform how Ireland does corporate taxation. At present, too many firms get away with paying low effective rates or availing of overly generous subsidies or tax holidays. Our Budget 2020 submission, published in June, contains numerous proposals to improve matters.

Last week the Department of Finance noted that some of Taoiseach Varadkar’s key taxation promises could be “inequitable” and lead to increased benefits for higher earners while middle-income taxpayers lose out. In this article, we present a number of possible situations for comparison. In all cases the income tax reduction policy examined would carry a full year cost of between 1.3% and 1.5% of the total income taxation yield (€299m-€342m). Click here to see which are the fairest options for Government in Budget 2020.

A Site Value Tax would be a fairer and more efficient way to generate additional government revenue than the current Local Property Tax, and it would also incentivise better use of land at a time when Ireland faces a significant housing and accommodation crisis.

The contribution of airplane emissions to climate change is well documented. It's time the aviation industry made a contribution to society that more accurately reflects the harm it does while ultimately incentivising individuals to fly less. Click here to read how Government could raise €200m in 2020 while benefiting the environment.

Social Justice Ireland regrets that to date Government has not committed to supporting European moves to introduce a Financial Transactions Tax. The tax offers the dual benefit of dampening needless and often reckless financial speculation and generating significant funds. Reports have estimated a net revenue yield of between €320m and €350m per annum in Ireland alone, while according to the United Nations, the amount of annual income raised would be enough to guarantee to every citizen of the world basic access to water, food, shelter, health and education. This tax has the potential to wipe out the worst forms of material poverty throughout the world.

Tax reliefs/expenditures represent revenue to the government that is being foregone. In 2016 tax reliefs amounted to approximately 10 per cent of total tax revenue - a very significant sum. However, unlike direct government expenditure, tax reliefs are not subject to annual assessment as part of the budgetary process. Social Justice Ireland considers it extraordinary that this is the case given the significant cost, and calls for reform of the process.

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