Tax and Taxable Capacity: Ireland in Comparative Perspective. Quarterly Economic Commentary-Winter 2012/Research Note

Callan, Tim and SDavage, Michael (2016) Tax and Taxable Capacity: Ireland in Comparative Perspective. Quarterly Economic Commentary-Winter 2012/Research Note. UNSPECIFIED.

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Abstract

What role can increases in tax revenue be expected to play in Ireland’s transition to a new long-run fiscal equilibrium? Ireland is widely perceived as having had a low tax regime through the boom and bubble period. Tax increases have featured strongly as part of Ireland’s economic adjustment programme. How much scope is there for further increases? Has Ireland come close to the limits of tax revenue from incomes? In this note, we provide some international perspectives on these issues. We build on the approach proposed by the Irish Fiscal Advisory Council – a hybrid measure of GDP and GNP to represent Ireland’s taxable capacity – to provide more meaningful comparisons of tax ratios in Ireland and in other EU countries.

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