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Friday 28 April 2017

'Better off if top rate rose by 2pc'

Charlie Weston

Charlie Weston

CHANGES to tax credits and bands hit lower and middle-income earners harder than hiking the tax rates, research has found.

The changes to tax credits in the last budget were so severe that such workers would have been better off even if the top rate of tax of 41pc went up by 2pc, a study commissioned by the Irish Independent has shown.

The Government has committed to maintaining the tax rates at the same level in next month's Budget.

The gross household income is around €53,800. If the tax credit and band changes of last year are replicated in the next Budget, someone on €50,000 would again lose €1,116.

However, if the top tax rate was to rise by 2pc, there would only be a €344 drop in income, calculations by Red Oak Tax Refunds show.

Irish Independent

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