A think tank has looked at the possible benefits of lowering Ireland’s income tax rates. There is currently a debate in Ireland on reducing either the 41 percent higher rate of the 20 percent basic range of income tax. Reducing the higher 41 percent income tax rate, levied on those with a gross income exceeding EUR32,800, would benefit only those paying tax at that rate, according to the left wing think-tank Social Justice Ireland. The think tank Social Justice Ireland also contends that increasing the standard rate band would not in fact help those on low incomes. Instead, those earning EUR50,000 would gain about EUR283.50 a year.
For this reason Social Justice Ireland contends that the “fairest outcome” would be achieved by an increase in tax credits. This should provide the same value to all taxpayers across the spectrum of income distribution, and, by making tax credits refundable, the full value would go to every taxpayer who has earned income. The main beneficiaries of such an initiative would be low-paid employees, at a modest cost to the Exchequer, it says.
