Written answers

Tuesday, 19 July 2011

10:00 pm

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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Question 122: To ask the Minister for Finance the return to the Exchequer in a full year if the rates of capital gains tax were increased to 30% and 40%. [21044/11]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that the estimated full year gain from increasing the rate of Capital Gains Tax (CGT) from 25% to 30% is €65 million, and from 25% to 40% is €195 million. However, these estimates assume no behavioural changes on the part of taxpayers, and large increases in rates such as are contemplated in the question may have a significant behavioural impact. CGT is very dependent on individual behaviour and a change in rate may not produce a corresponding increase or decrease in tax yield. In current economic conditions any estimate of additional yield must be treated with caution. The realisation of any estimated yield from an increase in taxation on assets relating to property is subject to movements in the value of such assets, which are currently occurring in the economy. In addition, increasing the rate could, in theory, lead to a reduction in yield from the tax.

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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Question 123: To ask the Minister for Finance the potential gains to the Exchequer annually if a limit of €150,000 was applied to the capital gains tax exemption for the transfer of assets between married couples. [21045/11]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that figures are not captured in such a way as to provide a dedicated basis for compiling estimates of the impact on the Exchequer from the measure proposed in this question. Accordingly, the specific information requested by the Deputy is not available.

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