Róisín Shortall (Dublin North West, Labour)
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Question 123: To ask the Minister for Finance the estimated yield to the Exchequer if the reckonable salary for pension relief purposes was reduced to €100,000 and €80,000 respectively. [9489/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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It is presumed the Deputy is referring to the current annual earnings cap of €150,000, which operates to limit the level of tax-relieved personal pension contributions in any one year. The annual earnings cap acts, in conjunction with age-related percentage limits of annual earnings, to put a ceiling on the annual amount of tax relief an individual taxpayer can obtain on pension contributions.

The full year yields to the Exchequer arising from reducing the earnings cap to the amounts mentioned in the question are estimated as follows:

A breakdown of the figures by reference to income levels is available only in respect of the tax relief for contributions to Retirement Annuity Contracts (RACs) and Personal Retirement Savings Accounts (PRSAs) to the extent that these contributions are included in the personal tax returns of tax payers.

With regard to occupational pensions, (that is, schemes set up by the employer), the figures in respect of employee contributions are available only in aggregate form. Information on such contributions is not captured in such a way as to make it possible to associate contributions with individual income levels. For that reason the estimated yields to the Exchequer provided in respect of these contributions are extremely tentative.

The estimates of yield are based on assuming that tax relief which would be affected by the changes mentioned in the question is currently allowed at the top income tax rate of 41% and at the maximum age-related percentage limit of earnings. The estimated figures provided could therefore be regarded as the maximum Exchequer yields in respect of those taxpayers.