Should Overtime Be Completely Tax Free?

Should Overtime Be Tax Free?

Niall talks to Independent Ireland TD Michael Collins about whether workers should be allowed to keep more of the money they earn from putting in extra hours.

Independent Kerry TD Michael Healy-Rae has proposed taxing qualifying overtime earnings at a flat rate of 20% as part of Budget 2027, arguing that people who work longer hours should not see so much of the additional income swallowed up by tax. Although INdependent ireland was the fist party to propose the idea

Niall asks whether the Government should go even further and abolish income tax altogether on overtime worked beyond 40 hours a week, as well as removing tax on tips.

Critics argue that such a move could reduce the money available to fund public services and create complications within the tax system. Supporters say it would reward hard work, encourage people to take on extra hours and put more disposable income into workers’ pockets, much of which would ultimately flow back into the economy through spending and VAT.

Would tax free overtime give working people a badly needed break, or is the idea simply too expensive and unrealistic?

Niall discusses the proposal with Independent Ireland TD Michael Collins.