There is also an issue in relation to the self employed that most of the high earners of course are in fact no more than agents for the State. Rates paid to doctors and barristers for example have been cut substantially. The need for a top up over PSWT is consequently a lot less.

I would not be expecting any additional tax due for 2011 from the self employed as I imagine overpayments will considerably exceed those who need to make a further remitance to balance their liabilities.

An examination into the Oct/Nov 2011 tax receipts can only give a partial insight into what the self-employed earned in 2010. It is only this Oct/Nov that their 2011 earnings will be taken into taxed (and at higher rates).

It is impossible to say what will happen but a large aggregate earnings drop from 2010 to 2011 is unlikely. With higher tax rates to be applied to 2011 income I think it is clear that more revenue will be collected from the 2011 income. This will be collected this year.

The real reflection of the state of income tax yield was the December tax figure I mentioned above.

An examination of the income tax payments in Oct/Nov 2011 suggests that there is precious little extra in yield from the self employed. Indeed taking into account the USC, income levels must have fallen quite substantially. The position for 2012 will surely be equally dire.

On the Revenue pursuit of the our pensioner tax defrauders, Ms Feehily mentioned yesterday a figure of over €300M taxable but not included in the Revenue calculations. Assuming one third is liable at the higher rate and the balance at 20% would assume a liability in the region of €80M. She came up with a net figure of €55M ish after additional claims for credits and deductions.

My own feeling is that there is a lot more to follow about the pensioners. For example there were a large number of pensioners claiming the half carer payment. Has this been included in the figures given to the Revenue? It appears not from the discussions yesterday.

Also you have huge numbers of pensioners resident in Ireland receiving Social Security pensions from abroad, in particular from the US & UK. These pensions are taxable in Ireland and many are unlikely to be known to the Revenue.

The yield from a concerted examination of the affairs of pensioners could provide a substantial windfall to the Revenue.

The loss of a large number of well paid jobs in the Public Sector and in financial services industry will hit the PAYE yield

Excellent post, agree that significant public sector reforms are vital. Perhaps the real trick might be to start looking at how the various activities of government are being performed (cost recovery and an emphasis on tech focussed processes and financial modelling) if efficiencies won’t be addressed with a Croke Park 2.0.
Also, how would you mark this Noonan Budget 2012 versus Lenihan Budget 2011 – http://www.ronanlyons.com/2010/12/08/dude-wheres-my-six-billion-perspective-on-budget-2011

Hope to read many more excellent posts in 2012.

B

That said, I’ve lived in rented accomodation for most of the last 14 years. As about 10 years of this was on relatively low salaries, with high debts (thankfully paid off), and little disposable income to talk of, it was always easier to either share or rent somewhere cheap and nasty in the hope of being able to get somewhere better in future.

I did find it striking that many welfare bound friends lived in much nicer accomodation but that was simply because they were defrauding welfare by working on the sly while claiming – naturally, they were considerably better off than those purely on welfare or working on modest wages. However most welfare tenants around me were in horrendous accomodation – I know exactly what you mean by tenements as my last home was exactly that – the slumlord built a mickey mouse “extension” out the back that made the place dark, freezing and damp, and enabled her to turn 4 apartments into 12 “flats.”

However – when I went to live, at the height of the boom – there it was nearly 120 euro cheaper than the rest of the market. And I really couldn’t afford anything better. It was no irony too, that one of my welfare scamming friends was the one who lectured me the most about my grotty home! But the welfare people at work and the (mostly) eastern european couples were clearly far worse off – there were over 20 people living in that house!! And somebody even had a cat!

Of course – it is worth pointing out that in many of those places the welfare tenants really had little choice – if they moved they had a ton of paperwork to deal with, most didn’t have cars, they can’t sustain the additional cost of raising deposits for somewhere better, and a lot of the time, they had real difficulty in paying for bins, tv licence, utilities, etc.

I recall in one place 3 flats went without any hot water for 3 weeks because nobody complained to the landlord. That place was declared substandard on a range of areas. But many liked the independence it gave them – plus living alone made it much easier to qualify for the “fringe benefits” of welfare such as the medical card, etc.

I do think there is an inevitable resentment from people who pay the full amount of rent – naturally its annoying to think that the guy next door pays an effective rent of 24 euro a week when you pay 145, but many tenants are forced to pay additional cash payments to the landlord, who doesn’t reduce the rent when tenant contributions are increased or benefit payable reduced. The real losers, though, are always the low earning tenants who really have no hope of ever buying – and I saw a lot of them among my neighbours, especially in Dublin in the late 1990s.