Written answers

Tuesday, 25 June 2019

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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148. To ask the Minister for Finance the estimated cost to the Exchequer if the entry point to the higher rate of income tax was increased to €50,000 for single earners and €100,000 for couples who are both working and equivalent change for taxpayer units with one partner in work; and if he will make a statement on the matter. [26771/19]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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Having regard to the Deputy's reference to an "equivalent change for taxpayer units with one partner in work", I have assumed for the purposes of this response that the estimated cost requested is for an increase to the standard rate cut off point for all income tax bands of €14,700, which would bring it to €50,000 for a single person, €59,000 for a married one income couple and €100,000 for a married two income couple in a single year.

I am advised by Revenue that the estimated full year cost of increasing the standard rate cut off points in this manner would be approximately €2.3 billion.

This estimated figure is based on projected 2019 incomes, calculated from actual data for the year 2016, and may be revised.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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149. To ask the Minister for Finance the work carried out to date on the issue of merging USC and PRSI; his plans to progress the issue; and if he will make a statement on the matter. [26772/19]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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An inter-departmental working group was established in February 2018 to examine and report on options for the amalgamation of USC and PRSI over the medium-term. The working group completed their work, in line with their terms of reference and their report was submitted to me in late 2018.

The Report addresses a range of options for how amalgamation could be achieved, but also has identified a number of serious challenges that will need to be further considered.

The amalgamation relates to State funds with an estimated combined value of over €7 billion per annum, collected from over 2.5 million income earners. The issue is therefore a complex one that will take time to consider.

Follow-on decisions will be taken in due course and I will make these public at the appropriate time.

More generally, the Government is committed to measures that positively benefit workers while also keeping the tax base broad.

Our income tax system has been transformed since 2008, following a necessary reform to broaden the income tax base in the interest of ensuring a stable revenue stream to fund essential public services.

I am determined to balance the priorities of ensuring that our personal taxation system remains progressive, competitive but also resilient in the future.

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