Budget 2015 – Some welcome news for your pocket!
In a recent article by Ann Marie Walsh (Irish Independent) she discussed the recent report by IBEC where it was revealed that most workers will be 1pc better off in their take home pay because of October’s Budget, according to the main employers’ body.
IBEC’s calculation of the marginal impact of Budget 2015 will throw some weight behind the Government’s claim that its measures, including an increase in the standard rate tax band, will increase pay packets for every worker in the country in the New Year.
This has been challenged by the Economic and Social Research Institute, which said the effect of the Budget and revised water charges scheme was close to neutral.
It said the measures would increase average incomes by less than 0.1pc.
The institute calculated that the top 10pc of earners would gain most, with incomes rising by 0.6pc, while the biggest losers would be the poorest 10pc, who would suffer an average loss of just over 1pc.
IBEC’s latest Economic Outlook also says the vast majority of Irish workers have lost between 8pc and 10pc of their take-home pay to higher income taxes due to austerity budgets.
It says other non-income tax charges, such as the property tax and indirect taxes, have jumped sharply.
“It is therefore clear that tax increases rather than wage cuts or cost of living trends have resulted in the standard of living drop which Irish workers have experienced over the past seven years,” it says.
It said January 2015 would see some reductions in income taxes for the first time since January 2007.
“Most workers will be about 1pc better off in their take-home pay as a result of the Budget 2015 measures and this will clearly be a factor in wage expectations,” says the report.
The analysis notes that despite the stealth tax hikes of the past number of years and higher income taxes, inflation is virtually zero. The current rate stands at 0.1pc.
As a result, it says there is “absolutely no cost of living basis” for wage increases in
Article originally by Ann Marie Walsh, Irish Independent2015, Employees, Employers, IBEC