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

Sinn Féin wants to abolish it. Even if the tax was on a house worth €10 million, Sinn Féin wants to have it abolished. Its position is illogical.

The domicile levy introduced in budget 2010 also constitutes a wealth tax. It is aimed at high wealth individuals with a substantial connection to Ireland, regardless of whether they are tax resident, to ensure they make a tax contribution to the country in a year of at least €200,000.

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 have no statistical basis for compiling estimates of the revenue to be raised from a potential wealth tax. Although an individual's assets and liabilities are declared to 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 a manner that would allow an analysis of the implications of an overarching wealth based tax.

Comprehensive data for household wealth in Ireland, including assets and liabilities, were published for the first time earlier this year by the CSO. The data have been collected across the entire eurozone according to a standardised methodology. The data indicate that the level of wealth inequality in Ireland in 2013, as measured by the Gini co-efficient, was lower than the eurozone average.The results also show that wealth is less concentrated at the top of the distribution in Ireland than the eurozone average. Central Bank analysis of the data also indicated that while wealth and inequality has increased since 2011, it is actually lower than in 2006, the earliest period from which data is available. Part of the research programme agreed between my Department and the ESRI covering macroeconomic and taxation issues, includes a research project involving detailed analysis of wealth distribution and taxation. It is intended that this research, based on the Household Finance and Consumption Survey, published this year by the CSO, will commence shortly.

A number of issues highlighted in the recommendation, including estimating the potential tax base and yieldable tax in Ireland also feature as part of the research work planned for the project. The data gathered by the CSO as part of the Household Finance and Consumption Survey was not collected for the purpose of calculating the potential yield from a wealth tax but for the purpose of collecting general information on the financial situation and behaviour of households. My Department will monitor and consider any additional information and data that comes to light and will continue to examine potential taxation sources. However, as I said earlier, I do not propose to accept the recommendation.

I can assure the Senator that is not a matter of good or bad manners that we cannot calculate the yield from his proposals for a wealth tax; the data is not available in Revenue and the Senator's proposals are unclear. Part of the proposal is to abolish the local property tax. The greatest amount of wealth held by normal families in this country is in the family home yet the Senator refuses to tax it at all and wants to abolish the local property tax completely. Senator Cullinane's first statement is to move back from his principle of taxing assets. He does not say he will abolish the wealth tax on houses valued up to €1 million, he wants to abolish it simpliciter. The Senator has no problem in exempting the houses in certain well-known leafy suburb of south Dublin - which are again selling at €5 million and €6 million - from the property tax. I do not understand the ideological purity that drives Senator Cullinane into that position.

The second proposal from the Senator exempts all agricultural land. I am not sure if he will or will not exempt stock so it is difficult to assess what could be collected from the agriculture sector. The Senator's proposal may tax the cows for all I know, but he certainly does not seem to have a specific inclusion. The Senator's proposal would exempt the farmhouse and the land but he has not exempted the farmyard. Being a Waterford man he probably comes from dairy country like myself and of course the wealth of many farms is in that half acre of the farm.