Oireachtas Joint and Select Committees

Tuesday, 7 November 2023

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach

Finance (No. 2) Bill 2023: Committee Stage

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein) | Oireachtas source

If the Minister wants to look at the overall tax package, the distributional impact gets worse. Under the section which we are dealing with, which is just USC, somebody earning just below the median wage in the State would benefit by €92.

As I said, somebody earning just below the median wage in this State would benefit by €92. Somebody earning twice that would benefit by €292. However, looking at the overall tax package, those numbers change to €292 for somebody just under the median and it would be €692 for somebody earning twice that. The gap actually increases not by €200 but by €400 when, as the Minister said, the other tax measures in the round are taken in. This is the issue. We look at the CSO data and at wages and weekly earnings. The median weekly earning in this State, according to the CSO, is €33,516. That means that half of workers earn less than that amount and half earn more than that amount. The difference here is that with this tax package somebody earning about that amount will benefit overall by about €292 whereas somebody earning twice that or, indeed, €100,000 will be nearly €700 better off. There is an unfairness in that regard. There is also a question in terms of why this would be done when other options are available, as we outlined. It only gets worse when you look at the overall tax package.

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