Saturday 20 October 2018

The myth of Ireland as a low tax economy

Dan O'Brien, in the first of a two-part series, looks behind the scenes at how the Government funds itself

PRINT AND BE DAMNED: Producing €50 notes at a European mint.
PRINT AND BE DAMNED: Producing €50 notes at a European mint.
Dan O'Brien

Dan O'Brien

'Ireland is a low- tax economy." This statement is frequently made, both at home and abroad. It is made because the amount of cash the State takes in is indeed lower than all other peer countries relative to the size of the economy, as it is most commonly measured.

But is it really the case? There are at least two parts to the answer. One is that when it comes to the biggest chunk of tax revenue - personal taxation - it depends how much you earn.

Another part of the answer is a clearer No - the amount of revenues the Irish State raises relative to the economy is much closer to European norms once the effects of inflated gross domestic product (GDP) are accounted for.

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