Skip to content
#Open journalism No news is bad news

Your contributions will help us continue to deliver the stories that are important to you

Support The Journal
Image: Shutterstock/Monkey Business Images

Changes to how Irish couples were taxed has led to increase in married women working

The changes made in Budget 2000 caused considerable debate and controversy at the time, according to the ESRI.
Jan 28th 2018, 9:46 AM 28,608 22

CHANGES TO HOW Irish couples were taxed in 2000 has led to an increase in the number of married women in employment.

According to the Economic and Social Research Institute (ESRI), the employment rate of married women increased by about 5 percentage points as a result of the reform which moved to a more individualised set of rules.

Up to 2000, Ireland had a system of joint taxation, which allowed a working spouse to use the tax allowances, credits and bands of a non-working spouse.

This imposed a higher tax rate on the non-earning spouse if they joined the labour market, making it less likely that they would take up employment.

Budget 2000 introduced the partly individualised income taxation system through a non-transferable element of the standard rate band.

According to the ESRI, this increased the financial incentive for non-working spouses to work.

#Open journalism No news is bad news Support The Journal

Your contributions will help us continue to deliver the stories that are important to you

Support us now

It added that the international trend in recent decades has been to move towards individualised taxation systems.

The author of the report Karina Doorley said: “This analysis indicates that the partial individualisation of the Irish taxation system achieved one of its stated goals, to increase the incentive for spouses to join the labour market.”

Read: The government will spend €40 million closing the ‘pensions gap’>

Send a tip to the author

Cliodhna Russell

COMMENTS (22)

This is YOUR comments community. Stay civil, stay constructive, stay on topic. Please familiarise yourself with our comments policy here before taking part.
write a comment

    Leave a comment

     
    cancel reply
    Back to top