Peadar Tóibín (Meath West, Sinn Fein)
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145. To ask the Tánaiste and Minister for Social Protection the cost of increasing the employee pay related social insurance exemption threshold to €377 and the introduction of a maximum relief of €12 per week (details supplied). [41787/15]

Joan Burton (Dublin West, Labour)
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Currently, PRSI Class A employees do not make an employee contribution where weekly earnings are under €352.01. Class A employees with weekly earnings of €352.01 or more make a 4% contribution charged on all of their earnings. This creates a "step effect" as net income reduces immediately by the full 4% PRSI charge applied to all earnings.

From 1 January 2016 a new PRSI Credit is being introduced and will reduce the amount of PRSI paid for those with weekly gross earnings between €352.01 and €424. The maximum weekly PRSI Credit of €12 applies at weekly earnings of €352.01. This will reduce the current weekly PRSI charge from €14.08 to €2.08 at this level of earnings. Where weekly earnings exceed €352.01 and are less than €424.01 per week, the maximum weekly PRSI Credit applying is reduced on a tapered basis. The new arrangements will ensure that all employees earning between €352 and €424 per week will pay less PRSI each week, effective from January next and the employee will always be better off as earnings increase.

Increasing the threshold to €377 with a €12 credit tapering as suggested would cost an additional €13.3 million in a full year (over and above the cost of the measure announced in the Budget) and affect 112,646 employments.