Written answers

Tuesday, 18 November 2014

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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171. To ask the Minister for Finance further to Parliamentary Question No. 233 of 21 October 2014 in which the consideration relating to trees growing on the land saleable under wood continues to be regarded as income arising from a trade and not capital gains, if he will indicate whether such income is considered under his proposed change in the income averaging period from three to five years; and if he will make a statement on the matter. [44055/14]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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The taxation of clear-felling profits earned from the forestry sector was examined in the recently published Agri-tax review.

Profits or gains from the commercial occupation of woodlands are tax exempt for the purposes of income and corporation tax. Clear-felling forestry profits are subject to the upper tax exemption limits of the High Earners Restrictions rules.

One of the recommendations of the review was that the working group should examine the feasibility of extending income averaging to forestry clear-felling profits.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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172. To ask the Minister for Finance if he will provide in tabular form the impact on single, employed PAYE earners on annual incomes of €15,000, €20,000, €25,000, €30,000, €40,000, €60,000, €100,000, €120,000, €150, 000 and €200,000 owing to the income tax and universal social charge changes in 2015 compared to 2014; if he will provide these figures in both cash terms and as a proportion of gross income; and if he will make a statement on the matter. [44056/14]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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The data requested by the Deputy are set out in the table below.

Gross IncomeIncome TaxUSCNet IncomeAnnual

Benefit
Change as % of Gross Income
ExistingProposedExistingProposedExistingProposed
%
15,0000039928514,60114,7151150.8%
20,00070070071954517,78117,9551740.9%
25,0001,7001,7001,06989521,23121,4051740.7%
30,0002,7002,7001,4191,24524,68124,8551740.6%
40,0006,2125,9402,1191,94530,06930,5154461.1%
60,00014,41213,9403,5193,34539,66940,3156461.1%
100,00030,81229,9406,3196,44458,86959,6167470.7%
120,00039,01237,9407,7198,04468,46969,2167470.6%
150,00051,31249,9409,81910,44482,86983,6167470.5%
200,00071,81269,94013,31914,444106,869107,6167470.4%


It should be noted that the introduction of the 8% USC rate and the increase in the existing 10% USC rate to 11%, provided for in the Budget, are necessary measures to limit the maximum benefit from the package of tax measures to approximately €14 per week for any individual taxpayer. This ensures that those with very high incomes will only benefit to the same extent, as those with more modest incomes, reinforcing the highly progressive nature of the Irish income tax system.

The changes announced in the Budget will ensure that all those currently paying income tax and/or USC will see a reduction in their tax bill in 2015. I propose to continue this reform in future Budgets, subject to the required economic growth and the consequent fiscal space available to the Government.

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