Written answers
Tuesday, 26 February 2008
Department of Finance
Tax Code
9:00 pm
Eamon Gilmore (Dún Laoghaire, Labour)
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Question 71: To ask the Tánaiste and Minister for Finance the number and percentage of income earners who paid tax on any part of their income at the higher rate and the standard rate for 2007, irrespective of off-setting using credits; the anticipated figures for each category for 2008; and if he will make a statement on the matter. [7724/08]
Brian Cowen (Laois-Offaly, Fianna Fail)
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I am advised by the Revenue Commissioners that the information requested by the Deputy is as follows in respect of the income tax years 2007 and 2008.
| Tax year | Exempt (Standard rate liability fully covered by credits or Age Exemption Limits) | Marginal Band | Paying tax at the standard rate (including those whose liability at the higher rate is fully offset by credits) | Higher rate Liability not fully offset by credits | All cases | ||||
| Number | % | Number | % | Number | % | Number | % | ||
| 2007 | 868,000 | 38.0 | 17,700 | 0.8 | 921,700 | 40.3 | 478,000 | 20.9 | 2,285,400 |
| 2008# | 878,100 | 37.6 | 17,900 | 0.8 | 937,000 | 40.1 | 504,500 | 21.6 | 2,337,600 |
| # Assuming the enactment of the changes announced in the 2008 Budget. |
Because of the operation of tax credits, many taxpayers who are nominally liable at the higher rate of tax pay tax at no more than the standard rate of tax. This is due to their higher rate liability for tax being fully offset by the value of their personal credits, as explained in pages C23 to C28 of the 2007 Budget booklet. The above data allows for this effect.
What matters to earners is the amount of their earnings that they keep in their pockets. For all income earners, whether single or married, the position is that their take home pay has increased very significantly in real terms over the last number of years.
Notes
The figures are estimates from the Revenue tax-forecasting model using actual data for the year 2004 adjusted as necessary for income and employment growth for the year in question. They are therefore provisional and likely to be revised. It should be noted that a married couple who has elected or has been deemed to have elected for joint assessment is counted as one tax unit. Figures in the table are rounded to the nearest hundred and any apparent discrepancies in totals are due to this.
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