Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

The Government has no plans to introduce a wealth tax although all taxes and potential taxation options are constantly reviewed.

Wealth can be taxed in a variety of ways, some of which are already in place in Ireland. Capital gains tax and capital acquisitions tax are in effect taxes on wealth in that they are levied on an individual or company on the disposal of, in the case of capital gains tax, an asset or the acquisition of an asset through gift or inheritance in the case of capital acquisitions tax. Deposit interest retention tax is charged at 41%, with limited exemptions on interest earned on deposit accounts.

Local property tax, which was introduced in 2013, is a tax based on the market value of residential properties. In order to estimate the potential revenue from a wealth tax it would first be necessary to identify the wealth held by individuals. I am informed by the Revenue Commissioners that they currently have no statistical basis for compiling estimates relating to a potential wealth tax, although an individual's assets and liabilities are declared to the Revenue in a number of specific circumstances, for example, after a death. This information is not a complete measure of financial assets in the State nor is it recorded in the manner that would allow analysis of the implications of an overarching wealth based tax.

I am advised that the Central Statistics Office's institutional sector accounts do not give an indicator of the number of households or persons classified by the categories of wealth they hold. These statistics are based on aggregate information collected from financial institutions and do not contain the demographic details which would enable such a breakdown of the statistics. However, I understand that following discussions involving the Department of Public Expenditure and Reform, the CSO and the Central Bank, the CSO has commenced the household finance and consumption survey, HFCS, which will collect information on household wealth. The results of this survey are not yet available.

The main aim of the HFCS is to provide structural information on households' assets and liabilities based on a representative sample of households. This will address gaps in knowledge about the economic well-being of households and the distribution and type of wealth, the liabilities among households and individuals as well as the factors that affect financial planning by households and individuals.

That data to be collected by the CSO as part of its household finance and consumption survey are not being collected for the purposes of calculating the potential yield for a wealth tax but to collect general information on the financial situation and behaviour of households. Such information may be relevant to the formulation of tax policy and I look forward to seeing the results of the HFCS.

Another factor to consider is that asset values increase and decrease over time and in the context of recent economic circumstances, they may have declined considerably in many cases. Thus, if the value of an asset or an individual's wealth is measured at a particular time, there is no guarantee that the asset value of the individual's wealth will remain at the level or increase from that point. This would make it difficult to predict the potential yield from a wealth tax and this would have to be borne in mind, in terms of its consistency, as a source of revenue.

My Department will monitor and consider any additional information and data that come to light and will continue to examine potential taxation sources. As I stated, I do not propose to accept the amendment at this time.