Oireachtas Joint and Select Committees

Wednesday, 20 September 2017

Committee on Budgetary Oversight

Ex-ante Scrutiny of Budget 2018: Nevin Economic Research Institute, Irish Congress of Trade Unions, Irish Tax Institute and Chambers Ireland

9:00 am

Dr. Tom McDonnell:

In advance of the budget. It will be the week before it. The arguments and the articulation will flow within that document. The broader point is that the danger with using single graphs is that they are a static point and the arguments around it are important.

What the OECD is saying with regard to fiscal costs and the fiscal supports that go to families is that Ireland is quite generous in how it treats families and single people, particularly families, in its budgetary policy. It is clear that when we talk about the tax rate, we are including things like employer PRSI. That would make it look better for the household than it really is. We have said that when it comes to taxes, and when social security contributions are excluded, the picture changes very much. When it is purely about the employee contribution, we move from 11th to seventh among the high-income EU countries. Perhaps the employee contribution is what is relevant in terms of take-home pay.

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