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October 16, 2009


Proposition Joe

Have you considered the complications/inequity of the taxation approach for separated or divorced parents, or indeed undeclared co-habitors?

A more equitable outcome could be produced by cutting the rate, but also handing back some of the savings to the poorest families via increased rates of Family Income Support.


A very useful analysis. What I would say is that each spending and tax adjustment needs to be modelled and its effects on the income distribution examined for fairness - as you have done here. But then the combined effect of a proposed bundle of measures (tax + spending) needs to be examined. If the Child Benefit were taxes as you show the middle income group is worse affected. But if the tax system is made a bit more progressive, for example by closing certain expenditures, removing PRSI ceiling and say, if there were to be a third band, then the overall effect could be 'evened out'

Still Joe makes a good point about the complications for separated parents.

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