Pearse Doherty (Donegal South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Social Protection if she will outline the resources, including Information technology consultancy and departmental expenditure, devoted to examining the possibility of taxing benefits paid to higher earners. [1554/13]

Joan Burton (Dublin West, Labour)
Link to this: Individually | In context | Oireachtas source

Questions relating to taxation are primarily a matter for my colleague the Minister for Finance. However consideration of what issues might need to be addressed around the taxation of social protection benefits do arise from time of time. For example, general issues arising for the social protection system around taxation of benefits were considered by my Department as part of its submission to the Commission on Taxation. Furthermore, issues arising from any decision to tax child benefit are considered by my Department such as in its policy and value for money review of child income support payments, published in 2010, and as part of its support to the Advisory Group on Tax and Social Welfare, whose report in this area is currently under consideration. It is not possible to quantify Departmental resources used in this way.

If the Government decided in principle to tax child benefit, there is a number of policy, legislative and administrative issues that would have to be addressed. While the nature of these issues would depend on the precise nature of any proposals to tax payments, these issues could include for instance the appropriate calculation of family income, the treatment of married and co-habiting couples and the potential for disincentive effects for income earners as it would add to reduce the return from higher earnings. In the absence of a more specific decision to progress on these lines, my Department has not addressed these specific issues in detail.

The Department has effective ICT systems in place to support inter-system communications with the Revenue Commissioners and has been exchanging data with Revenue for over 30 years in order to deliver welfare services and support tax collection. There may be some small amendments required to facilitate an additional data type being exchanged, but costs, if any would be minimum.