Michael McGrath (Cork South Central, Fianna Fail)
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143. To ask the Minister for Finance the annual cost of indexing tax bands, credits and allowance across all tax headings in tabular form; and if he will make a statement on the matter. [3159/16]

Michael Noonan (Limerick City, Fine Gael)
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It is not clear at what rate the Deputy is suggesting indexation, or to what extent this would apply across all taxes and duties. However, I am advised by the Revenue Commissioners that the Deputy may be interested to note the following in relation to indexation.

A Post-Budget 2016 Ready Reckoner is available on the Revenue Statistics webpage at . This Ready Reckoner shows a wide range of information, including the cost to the Exchequer of a 1% indexation of certain key elements of Income Tax and Universal Social Charge, as also set out in the following table. This table looks at a number of different options with regard to indexation.

These figures are estimates from the Revenue tax forecasting model using latest actual data for the year 2013, adjusted as necessary for income, self-employment and employment trends in the interim. They are estimated by reference to 2016 incomes and are provisional and may be revised.

I am further advised by Revenue of the following:

- A 1% indexation of CAT thresholds would imply a full year cost of approximately €3 million.

- A 1% indexation of the CGT annual exemption would imply a full year tax cost of approximately €0.1 million.

- A 1% indexation of VAT thresholds would imply an estimated €3.4m cost per annum.