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Comment by xp84 | Hacker News Reader

> Income taxes are also punishingly high - the top rate of tax (52%) kicks in under 100k

Wow -- got to make up for that famously lax corporate income tax, I guess! Which provides an interesting window into transnational company exploits. Ireland's decided to place more tax burden on individuals vs companies (which could have good reasons and could in theory even be net-neutral domestically, just shifting tax burden around between companies and their shareholders.) Now a giant tech company decides to domicile as much of itself as possible in Ireland, while themselves remaining US citizens and residents, since our tax code taxes individuals far more lightly than Ireland.

"This is a perfectly balanced game!"

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Well it isn't quite like this. The personal tax rate is banded, so only your income _above_ a certain amount is taxed at 52%.

Like, it's a progressive way to tax, rather than a lower flat rate.

Also, the gov just announced a big surplus again from multinationals, so I don't think it lines up to say the tax burden is shifted to individuals, when there is a really big take from corp tax also;

"Higher corporation tax receipts are expected to contribute to a budget surplus of €10 billion this year and €16.2 billion next year."

https://www.rte.ie/news/business/2023/0418/1377638-cso-gover...

Certainly, this is very normal. It makes sense to have a high rate of tax on extremely high earners!

But in the US the top tax rate kicks in at $539,901 (for a single person! Higher for married). In Ireland it kicks in at the princely sum of €70,044. We tax people on decent but not incredibly high incomes as though they're on Ferrari money. You might think "well that's Europe for you" but in Germany the highest rate of tax kicks in at €277,826 per year.

And for your taxes you get:

ridiculously expensive childcare (€1000 per month per kid - compared to nothing or a couple hundred a month per kid in other EU countries)

a collapsing HSE (wait times for pediatricians can be a year+ public, and I had to spend hours on the phone to find a private one who'd see my 3 year old in under a month)

(almost all) religious schools that still ask for a "voluntary" contribution

mediocre public transport

US-style car-dependent single use sprawl

horrible cycling infra

incompetent and agonizingly slow public bureaucracies (_especially_ immigration but tbf immigration is horrible most places)

and very high costs of living.

On the bright side, it's one of the better-shielded places from climate breakdown. The weather here is amazing. I grew up in a hot place and never want to be over 40C again.

I'm ok with that tax band at that level. And I imagine the majority of people in Ireland are, as there is no political appetite to tax the wealthiest people less.

People in finance and IT can make a ton compared to other folk. If the top tax band was raised to 500,000k or something all that extra money would just go on bigger houses, fancy cars and holidays and shit.

A less progressive tax system is bad for society. Eg. I just got a letter saying kids books will be free in primary schools now. Don't get me wrong, there are big problems in Ireland, but taxing well off people less is not gonna fix anything!

Perhaps people on 300k should have a different marginal rate of tax from those on 80k.

More to the point, someone who actually works for their money shouldn't be punished more than someone who got lucky buying a house at the right time.

I agree with you!

>_especially_ immigration

At least that is good, as immigration takes a lot of what little available housing that is available.

It's the same in the USA. Housing prices are shooting up on everything and 40 million Mexicans - not counting all the immigrants from other countries - that have moved here. Don't tell me that has zero effect on the housing market here in the USA. Probably more than all other causes combined.

> The personal tax rate is banded, so only your income _above_ a certain amount is taxed at [...]

Same for the US. Isn't every country like that? The US's highest federal income tax rate is 37%, and that applies to income over $578,125 for single people and $693,750 for married couples. This isn't counting state taxes (0-12.3% depending on the state) and FICA taxes (2.35% at that income level).

So in some states you do match the Irish rates? There's no extra layers like state or city tax in Ireland for individuals, local government is funded by national government, business rates, and sometimes specific charged for services (e.g. bin collection, though private options exist too)

In no states do we hit the Irish rates on your marginal dollar for someone whose taxable income is say € 75000. ( = $82000 ) In Ireland your next euro would be taxed at 52% but in say, NYC which may have the highest burden since it has a rare local income tax:

Using single figures, married is different:

Federal tax -> falls into the 22% bracket (covers taxable income $41,776 to $89,075)

State tax -> 6.25% bracket

Local tax -> 3.819% bracket

Obviously we have the same marginal system you do, so I'm only talking about how much of your "next dollar" is taxed but that adds up to just over 32%.

On the other hand, health insurance. One guess from Google says "a Silver tier plan in New York costs $710 monthly" so using that 710 x 12 = 8,520 a year, or about 10% of your income (note: since we deduct health premiums off your income, it would actually effectively reduce your taxable income and rejigger those tax brackets). And our property tax can be staggering in high-cost areas, and is obviously passed on even to renters. Mine is in the neighborhood of $8,500 a year.

Also does Ireland have a "standard deduction"? This is just an amount that everybody gets to subtract before even using the brackets to compute, so our brackets don't really start taxing at dollar #1 like they appear to.

Anyway, it's all ridiculous, I know! But yeah, it looks like your "€75000 earner" isn't all that disadvantaged compared to here. Your €200000 earner definitely is, though! :D

Sources: * https://www.nerdwallet.com/article/taxes/federal-income-tax-...

* https://www.nerdwallet.com/article/taxes/new-york-state-tax

* https://propertyclub.nyc/article/new-york-city-income-tax#ny...

> And our property tax can be staggering in high-cost areas, and is obviously passed on even to renters. Mine is in the neighborhood of $8,500 a year.

The high band of property tax is €300/yr and I've never heard it passed on to renters here.

> Also does Ireland have a "standard deduction"? This is just an amount that everybody gets to subtract before even using the brackets to compute, so our brackets don't really start taxing at dollar #1 like they appear to.

Yes, there's a minimum standard deduction of €3550 (€1775 for single person, plus €1775 for being an employee), that is effectively deducted from the tax bill at the final step, and others may replace these with larger amounts for different categories of workers, life circumstances on top of that.

It would be passed on to renters as a higher price.

In theory yes, but this tax was introduced in recent memory and the rate of rent increases that year was not noticeably different to the rate of rent increases in other years, as the prices are limited (well "limited") by the ability of tenants to pay, rather than being driven by costs. And the most expensive areas have rent control anyway.

True, RPZ makes it harder to pass along costs. And it makes sense tenant ability to pay affects rents in the current shortage.

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