Written answers
Wednesday, 8 November 2017
Department of Finance
Exchequer Returns
Pearse Doherty (Donegal, Sinn Fein)
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102. To ask the Minister for Finance the appropriate annual percentage multiplier for increases in general government tax revenue relative to GDP, GNP and GNI growth, for example, the amount each point of growth would be expected to be reflected in tax revenue; and if he will make a statement on the matter. [47313/17]
Paschal Donohoe (Dublin Central, Fine Gael)
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There is no clear guide as to the impact of different growth rates of GDP, GNP or GNI on general government revenue as the exact effect is a function of the composition of growth. For example, increased economic activity driven by exports does not have as significant an impact on the public finances as, for example, domestically driven growth.
As a general rule of thumb, assuming no change in tax policy, every increase of 1 percentage point of nominal GDP will result in about a 1 percentage point increase in general government revenue.
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