Thursday 23 October 2014

Welfare benefits need to be part of the calculations

Published 29/08/2014 | 02:30

Other calculations should be included
Other calculations should be included

THE Nevin Institute is fast becoming an important think tank that offers a fresh take on Irish life. It may be funded by the trade unions but the researchers are serious and trying hard to throw some light on parts of the economy that are often poorly understood.

So what are we to make of the findings that the poor and the rich pay more taxes than the middle class?

One obvious caveat is that information is old; it was collected in 2009 and 2010 but has only recently become available to researchers.

This means it does not take account of the altered universal social charge which has boosted the tax burden for many but not the worst off.

Another, and perhaps more important, caveat is that the study does not seem to take any account of benefits paid to the poor. Can somebody receiving free medical care and rent allowance really be said to pay any tax even if they do pay some taxes in the shape of VAT and excise duty?

When considerations such as these are excluded in calculations, it is difficult to place too much faith in the conclusions but that is not a criticism of the Nevin Institute; attempting to work out who bears the brunt of any tax system is an immensely complex task that requires enormous resources. It is time we had a national debate about taxes but a debate based on hard facts.

Irish Independent

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