Michael McGrath (Cork South Central, Fianna Fail)
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33. To ask the Minister for Finance the yield in each year since the universal social charge was introduced, including the 45% rate of USC that applies to the employees of financial institutions that have received financial support from the State and receive performance related bonus payments, if the provision still applies; and if he will make a statement on the matter. [26167/14]

Michael Noonan (Limerick City, Fine Gael)
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Section 531AAD of the Taxes Consolidation Act 1997 provides for a charge on bonus payments over €20,000 paid to employees of financial institutions that received financial support from the State under the Credit Institutions (Financial Support) Act 2008.  This charge, the excess bank remuneration charge , is incorporated into the Universal Social Charge and applies in all respects as if it was USC except that it is charged at a higher rate of 45%.  The normal USC rates are not applied.  The charge applies for 2011 and subsequent tax years, resulting in these bonus payments attracting an effective tax rate of 90%.

The measure was introduced to discourage inappropriate additional payments to employees of these financial institutions when these institutions very existence is contingent on taxpayer support. Since the advent of the financial crisis, the citizens of Ireland have endured several years of austerity as we seek to put the public finances back on a sound footing and to restore the nation to prosperity. It would not be appropriate that well paid individuals, whose livelihood was ensured by sacrifices made by so many ordinary people, should benefit in the face of the challenges faced by the rest of society.

It was the unique circumstances where some of these financial institutions wished to proceed to make these payments against the wishes of the then Minister for Finance that required this special legislation.

The Revenue Commissioners have informed me that 47 individuals were subject to the charge in 2011 while nobody came within the charge in 2012 or 2013.