Share

Income Tax Changes since 2007 - adding it all up

Posted on October 09, 2015 by Micheál Collins

By how much have income taxes changes since 2007?

One insight is to calculate  Budget-by-Budget the net income effect for three sample household types - households which are typical of working families/people those throughout society. These are a single worker with a gross income of €40,000, a couple with one earner on a gross income of €40,000 and a couple with two earners on a gross income of €50,000. All workers are assumed to be PAYE earners.

Table: Impact of Budget Income Taxation Measures on the Post-Tax Income of Three Sample Household Types, 2007-2015 (10 Budgets)

 

Single Earner     €40,000

Couple One Earner      €40,000

Couple Two Earners     €50,000

Budget 2007

     +900

   +530

   +1,736

Budget 2008

     +434

   +210

   +280

Budget 2009

     -190

   -400

   -500

Budget 2009S*

     -1,200

   -1,200

   -1,325

Budget 2010

       0

    0

    0

Budget 2011

     -834

   -258

   -363

Budget 2012

       0

    0

    0

Budget 2013

     -264

   -264

   -264

Budget 2014

       0

    0

    0

Budget 2015

     +446

   +174

   +346

 

 

 

 

Change 2007-2015 

 

 

Total €

     -708

   -1,208

   -90

% Gross Income

     -1.8%

   -3%

   -0.2%

Change 2009-2015

 

 

Total €

     -2,042

   -1,948

   -2,106

% Gross Income

     -5.1%

   -4.9%

   -4.2%

Source:

Collins (2015: 9)

Notes:

* Supplementary Budget delivered in April 2009. Calculations assume PAYE workers on full rate PRSI and for couples gross income splits 65%/35%.

 

Across the entire period, 2007-2015, all earners experienced an increase in the total of income related taxes that they paid. However, given the extent of the taxation reductions in 2007 and 2008, the cumulative effect is a small overall increase in the amount of taxes paid; ranging from 0.2% to 3% of gross income. Judged only from 2009 onwards, when the first of a series of crisis related Budgets were delivered, the changes are more notable with increases in income related taxes of between 4% and 5% of gross income; equivalent to each of the three households examined paying approximately €2,000 extra per year in income related taxes compared to 2009.

The table comes from a recent NERI research paper available here: http://www.nerinstitute.net/research/taxes-and-income-related-taxes-since-2007/

Posted in: IncomeTaxation

Digital Revolutionaries