Written answers

Friday, 16 September 2016

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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264. To ask the Minister for Finance the amount that could be raised by increasing Corporation Tax to 20%, the standard rate of PAYE for workers. [25343/16]

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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265. To ask the Minister for Finance the amount that could be raised by increasing the effective rate of corporation tax to the effective rate of income taxation, PAYE and USC, for workers on the median wage. [25344/16]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 264 and 265 together.

I am advised by the Revenue Commissioners that it is not possible to accurately estimate the additional revenue that may be brought in from increasing the 12.5% corporation tax rate to either the standard rate of income tax or the effective rate of tax for workers on the median wage. This would require ex ante knowledge of any behavioural changes on the part of taxpayers as a consequence. In terms of any increase in the 12.5% rate, the negative impacts of behavioural effects on the corporation tax yield are likely to be relatively significant.  Additionally, due to the interaction of reliefs and allowances after the calculation of gross tax at the various corporation tax rates, it is not possible to identify the amount of receipts that are in respect of profits taxable at the 12.5% rate alone. However, I am advised by Revenue that the vast majority of the net receipts are from the 12.5% rate of tax.

The Deputy may wish to note the published statistics regarding corporation tax receipts available on the Revenue website at . The Deputy may also wish to note that an analysis of the Corporation Tax payments in 2014 and 2015 has been published via the following link and further information on corporate profits, before allowing credits and reliefs are published at .

In 2014 the Department of Finance carried out and commissioned extensive research which sought to quantify the effect of corporation tax policy on the Irish economy.  The comprehensive Economic Impact Assessment of Ireland's Corporation Tax Policy was published on the Department's website on Budget day.  As part of this project, the Economic and Social Research Institute ('ESRI') were commissioned to carry out a study into the impact that the corporation tax rate has on the decision of firms to invest in Ireland.  This independent research found that if Ireland had increased the 12.5% corporation tax rate it would have considerably reduced the amount of Foreign Direct Investment ('FDI') into Ireland. 

The maintenance of the standard 12.5% rate of corporation tax is therefore important for Ireland's economy. Ireland, like other smaller member states, is geographically and historically a peripheral country in Europe.  A competitive corporate tax rate is a tool to address the economic limitations that come with being a peripheral country, as compared to larger core countries.  Ireland's corporation tax rate plays an important role in attracting FDI to Ireland and thereby increasing employment here.  This evidence underpins the Government's continued commitment to the 12.5% rate. 

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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266. To ask the Minister for Finance the amount that could be raised by imposing a 5% wealth tax on the top 1% wealthiest households. [25345/16]

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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267. To ask the Minister for Finance the amount that could be raised by imposing a 2% wealth tax on the top 5% wealthiest households.; and if he will make a statement on the matter. [25346/16]

Photo of Tommy BroughanTommy Broughan (Dublin Bay North, Independent)
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329. To ask the Minister for Finance the estimated yield to the Exchequer from the introduction of a wealth tax of 0.6% on the wealthiest 5% of households here; and if he will make a statement on the matter. [26116/16]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 266, 267 and 329 together.

There is currently no statistical basis for Revenue to compile estimates in relation to a potential wealth tax. Although an individual's assets and liabilities are declared to the Revenue in a number of specific circumstances (for example, after a death), this information is not a complete measure of financial assets in the State, nor is it recorded in a manner that would allow analysis of the implications of an overarching wealth based tax.

As part of the research programme agreed between the Department of Finance and the ESRI covering macroeconomic and taxation issues, a research project involving detailed analysis of wealth distribution and taxation has been included. Officials from both institutions are currently analysing the components of the wealth held by Irish households, using data available from the CSO's Household Finance and Consumption Survey (HFCS) which was collected in 2013 and which the CSO made available to my department earlier this year. The research will enhance understanding of the distribution and composition of wealth in Ireland and will explore various wealth tax scenarios for the purposes of better-informed policy making.  The research project is ongoing and it is intended that the results will be ready for presentation at the Department's annual Tax Policy Conference in November 2016.

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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268. To ask the Minister for Finance the amount of revenue that has been raised from taxation of residential rental income for each year since 2011. [25347/16]

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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269. To ask the Minister for Finance if he will provide a breakdown of the annual cost since 2008 of the tax reliefs and exemptions available to residential landlords. [25348/16]

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Anti-Austerity Alliance)
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273. To ask the Minister for Finance the amount that could be raised by applying a 75% rate of income tax on the rental profits of the third and subsequent rental units owned by large residential landlords. [25352/16]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 268, 269 and 273 together.

I am advised that Revenue do not require rental income to be returned in a manner that would enable residential rental accommodation income to be separately identified from rental income in respect of other types of property, such as commercial rental property. It is not therefore possible to provide the amount of revenue raised from the taxation of residential rental income, the annual cost since 2008  of tax relief and exemptions availed of by residential landlords or the amount that could be raised by applying a 75% rate of Income Tax on the rental profits of particular classes of residential landlords as sought by the Deputy.

However, the Deputy may wish to note that the 2013 Report of the Comptroller and Auditor General contains, in Chapter 16, a detailed review of the taxation of rental income and expenses deductible therefrom.  This report is available on the website of the Comptroller and Auditor General and can be accessed via the following link:

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