Mr. Derek Moran:

That is a policy matter. When one looks at this situation for analytic purposes, we look at how to explain the behaviour of the tax. Policy is what policy is and we work within that framework. The analysis tries to understand why one element of a charge on income behaves differently to another charge. One of the things that must be done is to identify what characteristics are different between the taxes. To some extent we will fix the issue of elasticity in the next forecasting round and we will be using a lower elasticity for USC projection, but we also look to see if there are other structural aspects and what modulation must be done within the forecast. It is strictly a forecasting issue.