Róisín Shortall (Dublin North West, Social Democrats)
Link to this: Individually | In context | Oireachtas source

169. To ask the Minister for Finance the estimate of the first and full year yield from each percentage point increase in the minimum effective tax rate of persons earning more than €400,000 per annum. [36931/19]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am advised by Revenue that a 1% increase in the average effective rate of income tax on taxpayer units with gross incomes in excess of €400,000 would raise an estimated €37m and €49m on a first and full year basis respectively.

This estimate is based on actual data for 2017, the latest year for which data are currently available. Taxpayers who are married or in a civil partnership are counted as one taxpayer unit and their incomes are combined.

Róisín Shortall (Dublin North West, Social Democrats)
Link to this: Individually | In context | Oireachtas source

170. To ask the Minister for Finance the estimate of the first and full year cost of refunding unused income tax credits to all low paid workers. [36932/19]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The matter of refundable tax credits was looked at in some detail in 2002 by the Working Group established under the Programme for Prosperity and Fairness. The Group was chaired by the Department of Finance and included representatives from ICTU, IBEC, the various farming organisations, the Community and Voluntary Pillar, relevant Government Departments and the Office of the Revenue Commissioners.

The Working Group found that there were significant disadvantages with such a system.  These included the potential negative impacts on the incentive to work, labour supply, labour force participation and overall productivity and output.  The Commission on Taxation in its 2009 report also did not recommend the introduction of refundable tax credits.

Furthermore, the cost of providing refundable tax credits would be extremely high.  Revenue have in the past estimated the cost of providing a limited refundable tax credit, that is, refundable only to those currently on the tax record, at approximately €2 billion per annum.

I am aware that certain Groups have proposed different schemes for refundable tax credits which are based on a number of arbitrary restrictions such as age, hours worked, income and PRSI contributions in the previous year. These Groups have claimed much lower costs for these schemes.  However, my Department and the Revenue would dispute these lower costings. 

What is not in doubt, however, is that refundable tax credits can have a negative impact on the incentive to work.  In these times when we need to encourage people to join the workforce and remain in the workforce very significant difficulties exist with the use of refundable tax credits.

The income tax and USC changes I introduced in the last number of Budgets will benefit all those who currently pay income tax and/or USC.  The minimum wage has also been increased over recent Budgets and now stands at €9.80 per hour, in an effort to support those on lower incomes.  Continued progress in this area will be made in the context of resources available in Budget 2020 balanced against all of the competing demands.

Róisín Shortall (Dublin North West, Social Democrats)
Link to this: Individually | In context | Oireachtas source

171. To ask the Minister for Finance the estimate of the first and full year yield from standard-rating all discretionary tax reliefs and expenditures that cost in excess of €10 million per annum in revenue foregone; and the breakdown for each tax relief and expenditure. [36933/19]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am advised by Revenue that the full year estimated yields from standard-rating discretionary tax reliefs and expenditures, which currently apply at the marginal rate, and cost in excess of €10 million per annum in revenue foregone, are as follows.

These yields are based on actual 2017 data, except for the High-Income Earners Restriction Carry Forward estimate, which is based on 2016 data. It is not possible to provide a first year costing due to the nature of the data utilised and how it is maintained on Revenue’s systems.