Friday 24 January 2020

Workers hit with extra €5bn a year income tax

Dermot O'Leary is chief economist with Goodbody
Dermot O'Leary is chief economist with Goodbody
Charlie Weston

Charlie Weston

Ordinary workers are bearing a massive burden of higher income taxes to bail out the State since the crash.

New calculations show that workers are now paying €5bn a year extra in income tax alone since the boom.

This is despite fewer workers in the system as unemployment remains elevated.

Workers are bearing the higher burden to run the State and pay for services like health and public sector wages since the boom in 2008.

Overall tax revenues over the past 12 months have returned to boom-era peaks, economist Dermot O'Leary of Goodbody said, based on the latest Exchequer returns. And income tax payments are now the biggest element of the tax take.

Mr O'Leary said this was proof workers have borne the burden of the adjustment over the period. "Given that employment is still 7pc below those 2007 levels this highlights the degree to which workers have taken the burden of the adjustment over that period," he said.

A series of adjustments to tax bands, the introduction of the universal social charge (USC), and the restriction and abolition of tax reliefs has hiked the amount of income tax paid by households.

Irish Independent

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