Written answers

Wednesday, 13 January 2021

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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237. To ask the Minister for Finance the estimated full year yield from each 1.5% increase in the minimum effective tax rate of persons earning over €150,000 per year. [1182/21]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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The High Income Individuals' Restriction (HIIR), provided for in Section 485C of the Taxes Consolidation Act 1997, limits the use of specified reliefs in calculating a taxpayer’s taxable income. The Restriction is designed to ensure an effective rate of 30% where a taxpayer has income of €400,000 or more (adjusted in accordance with the provisions of the Section). The Restriction begins to apply when income is greater than €125,000 and the total of specified reliefs exceeds €80,000.

I am advised by Revenue that taxpayers who were subject to the HIIR in 2018, the latest year for which data are available, with an adjusted income of €400,000 or more, had an effective tax rate (excluding USC) of 29.9%. 

Regarding the Deputy’s Question, I am advised by Revenue that taxpayers who were subject to the HIIR on incomes between €150,000 and €400,000 in 2018 had an effective tax rate (excluding USC) of 23%. A 1.5% increase in this effective rate would yield an estimated €0.8m per year.

I am further advised by Revenue that statistics on the operation of the HIIR are published at link: , which may be of interest to the Deputy.

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