Legal method of reducing your tax bill, e.g. by using all your tax credits.

Illegal method of not paying tax, e.g. by not declaring all of your income.

Workers pay this tax on their earnings. The rates are 20% and 40%. This tax is used for running the country.

Income tax paid by the self employed.

Tax on spending on goods and services.

Tax on imports from outside the EU.

Tax on certain goods such as alcohol and cigarettes. The point of the tax is to reduce the use of these goods.

Tax based on the value of your property.

Tax on written documents, e.g. purchase of property.

Tax paid to the local authority for the upkeep of roads.

Capital Acquisitions Tax

Tax paid on gifts and inheritance.

Taxes income as it is earned, e.g. PAYE & DIRT.

Taxes money as it is spent on goods and services, e.g. VAT.

Takes into account ability to pay, e.g. PAYE.

Does not take into account ability to pay, e.g. VAT.

The amount of tax paid should be related to the ability to pay, e.g. PAYE is but VAT is not.

The amount of tax owed should be clear and predictable, e.g. PAYE has clear rates 20%, 40%.

The cost of collecting the tax should be kept to a minimum, e.g. the Revenue can email reminders for motor tax instead of posting them.

It should be easy for each person to pay their taxes, e.g. motor tax can be paid online.

Refers to all money received by the government (current and capital).

Government Expenditure

Refers to all money spent by the government (current and capital).

Money received by the Govt. on a regular basis, e.g. PAYE.

Money spent by the Govt. on day-to-day or regular expenses, e.g. salaries of nurses.

Money received by the Govt. on a once off or irregular basis, e.g. Sale of state owned companies.

Spending by the Govt. on once off projects that will have long term benefits for the country, e.g. building the Metro North.

A tax on company profits. Currently 12.5% in Ireland.

Planned income is equal to planned expenditure.

Planned income is greater than planned expenditure.

Planned expenditure is greater than planned income.

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Tax & Govt Budget

Junior Cycle

Term	Definition
Tax Avoidance	Legal method of reducing your tax bill, e.g. by using all your tax credits.
Tax Evasion	Illegal method of not paying tax, e.g. by not declaring all of your income.
Pay As Your Earn	Workers pay this tax on their earnings. The rates are 20% and 40%. This tax is used for running the country.
Self-assessment tax	Income tax paid by the self employed.
Value Added Tax	Tax on spending on goods and services.
Customs duties	Tax on imports from outside the EU.
Excise duties	Tax on certain goods such as alcohol and cigarettes. The point of the tax is to reduce the use of these goods.
Local Property Tax	Tax based on the value of your property.
Stampy Duty	Tax on written documents, e.g. purchase of property.
Motor tax	Tax paid to the local authority for the upkeep of roads.
Deposit Interest Retention Tax	Tax on interest on savings.
Capital Gains Tax	Tax on profits on assets.
Capital Acquisitions Tax	Tax paid on gifts and inheritance.
Direct Taxes	Taxes income as it is earned, e.g. PAYE & DIRT.
Indirect Taxes	Taxes money as it is spent on goods and services, e.g. VAT.
Progressive taxes	Takes into account ability to pay, e.g. PAYE.
Regressive taxes	Does not take into account ability to pay, e.g. VAT.
Canon of Equity	The amount of tax paid should be related to the ability to pay, e.g. PAYE is but VAT is not.
Canon of Certainty	The amount of tax owed should be clear and predictable, e.g. PAYE has clear rates 20%, 40%.
Canon of Economy	The cost of collecting the tax should be kept to a minimum, e.g. the Revenue can email reminders for motor tax instead of posting them.
Canon of Convenience	It should be easy for each person to pay their taxes, e.g. motor tax can be paid online.
Government Revenue	Refers to all money received by the government (current and capital).
Government Expenditure	Refers to all money spent by the government (current and capital).
Current Revenue	Money received by the Govt. on a regular basis, e.g. PAYE.
Current Expenditure	Money spent by the Govt. on day-to-day or regular expenses, e.g. salaries of nurses.
Capital Revenue	Money received by the Govt. on a once off or irregular basis, e.g. Sale of state owned companies.
Capital Expenditure	Spending by the Govt. on once off projects that will have long term benefits for the country, e.g. building the Metro North.
Corporation Tax	A tax on company profits. Currently 12.5% in Ireland.
Balanced Budget	Planned income is equal to planned expenditure.
Budget Surplus	Planned income is greater than planned expenditure.
Budget deficit	Planned expenditure is greater than planned income.

Created by: jennymarshall

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