1.
NERI POST-BUDGET SEMINAR
19 OCTOBER 2016
Eamon Murphy
Economic & Social Analyst
eamon.murphy@socialjustice.ie
www.socialjustice.ie
@eamonsji

2.
Employment and Tax
Before Budget 2017 After Budget 2017
Salary range Rate Salary range Rate
€0 - €12,012 1% €0 - €12,012 0.5%
€12,013 - €18,668 3% €12,013 - €18,772 2.5%
€18,669 - €70,044 5.5.% €18,773 - €70,044 5%
€70,045 + 8% €70,045 + 8%
@eamonsji
€335m Spent on alterations to USC bands and rates

3.
Example
• Person B earns approximately 3 times as much as Person A
• Person B gains approximately 3 times as much as Person A
@eamonsji
Person A Person B
Marital Status Single Single
Salary € 23,400 € 72,000
Salary Benchmark
Living Wage
(€11.50 per hour)
Twice average
earnings
Gain from Budget 2017 € 119 € 351.50
Gain as a % of salary 0.51% 0.49%

4.
Employment and Tax
• €335m spent on alterations to USC bands and rates
• €48m on income tax reductions
• For that same €383m you could have
(a) Made tax credits refundable (€140m)
(b) Increased the personal tax credit for all earners by €100
per person per annum (€227m)
….and had money to spare!
• Small increase to the minimum wage (10 cent per hour)
Low paid workers looking forward to 2030
• Young people didn’t get the full benefit
@eamonsji

5.
Trends in effective tax rates
@eamonsji
5%
7%
9%
11%
13%
15%
17%
19%
2008 2009 2009* 2010 2011 2012 2013 2014 2015 2016 2017
Single earner on €25,000 Couple 1 earner on €40,000 Couple 2 earners on €60,000

6.
Trends in effective tax rates
@eamonsji
5%
10%
15%
20%
25%
30%
35%
40%
1997 1999 2001 2003 2005 2007 2008 2009 2009* 2010 2011 2012 2013 2014 2015 2016 2017
Single earner on €25,000 Couple 1 earner on €40,000 Couple 2 earners on €60,000

7.
Housing and Homelessness
@eamonsji
Supply is the problem, so demand is the solution?
Help to Buy Scheme
• First Time Buyers
• Income tax rebate of 5% on newly constructed home
• Based on income tax paid during the four years prior
to purchase.
• Full amount available on homes worth €400k.
Available on homes worth less than €600k.
• Pro-rata rebate will be made available in respect of
those below €400,000.

8.
Housing and Homelessness
@eamonsji
Other options…
• 400 social housing units
• Levy on undeveloped land
• Replace the Local Property Tax with a Site Value
Tax
Incentivise developers to put land to use
• Off-balance-sheet mechanisms
Invoke Structural Reform Clause
Create a Special Purpose Vehicle

9.
Homelessness August 2015
to August 2016
@eamonsji
0
1000
2000
3000
4000
5000
6000
7000
Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16
Homeless Adults Families Dependents Total Homeless
Extracted from Department of Housing, Planning, Community and Local Government Homelessness Statistics, www.environ.ie

10.
Vacant units vs Housing Waiting Lists
@eamonsji
0
5000
10000
15000
20000
25000
30000
35000
40000
Waiting List 2013 All Vacant 2016 Vacant (excl. Hol homes) 2016
Source: Census 2016, www.cso.ie and Housing Agency, Summary of Social Housing Assessments 2013, December 2013

11.
Other selected areas
@eamonsji
• Childcare
not a bad start, but….

12.
Other selected areas
@eamonsji
• Childcare
not a bad start, but….
• Climate change

13.
Education spending
@eamonsji

14.
Other selected areas
@eamonsji
• Childcare
not a bad start, but….
• Climate change
• Education
• Demographic concerns

15.
Other selected areas
@eamonsji
• Childcare
not a bad start, but….
• Climate change
• Education
• Demographic concerns
• Official Development Assistance
fall in overseas aid as a % of GNP

16.
Trend in Ireland’s overseas aid (% of GNP)
@eamonsji
Source: Census 2016, www.cso.ie and Housing Agency, Summary of Social Housing Assessments 2013, December 2013
0.00
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
2000 2002 2004 2006 2008 2010 2012 2014 2016
The UN-agreed target of 0.7% of GNP

17.
Thank you
@eamonsji www.socialjustice.ie