Tuesday, 27 July 2021
Department of Finance
444. To ask the Minister for Finance the estimated revenue that would be generated on a first-year and full-year basis for 2022 by introducing a 3%, 4% and 5% income tax surcharge on the portion of individual incomes in excess of €140,000. [41353/21]
I am advised by Revenue that the following table sets out the estimated yields to the Exchequer that would arise from the introduction of an individualised surcharge applicable on income in excess of €140,000, as set out by the Deputy.
|Surcharge||First Year €m||Full Year €m|
These estimated figures are based on projected 2021 incomes, calculated from actual data for the year 2018, that latest year for which full data are available, and may be revised.
446. To ask the Minister for Finance the estimated revenue that would be generated in 2022 by introducing a 40% rate of capital gains tax on the disposal of assets made by persons in cases in which the gains accrued are in excess of individual incomes of €200,000, €300,000, €400,000 and €500,000, in order that the 40% rate only applies to gains made above the aforementioned thresholds. [41355/21]
It is assumed that the Deputy is proposing a higher rate of Capital Gains Tax (CGT) for individuals with income in excess of the thresholds noted, who also have taxable gains in excess of the same thresholds.
I am advised by Revenue that the estimated revenue generated from the proposed rate of 40% is as outlined in the table below. The estimates are based on income and CGT returns for the tax year 2018, that latest year for which full income information is available. The estimates assume no change in behaviour by individuals resulting from the increase in the tax rate and do not include any yield in respect of companies.
|Income and Taxable Gains Threshold||Yield €m|
447. To ask the Minister for Finance the estimated revenue that would be generated in 2022 by increasing the rate of dividend withholding tax to 30 and 33 %, respectively; and if he will make a statement on the matter. [41356/21]
I am advised by Revenue that the ‘Ready Reckoner’, which is available at link: www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf , shows on page 13, the estimated yield from changes to the rate of Dividend Withholding Tax (DWT). The proposed increases can be derived on a pro rata basis from those indicated in the published table.
For the convenience of the Deputy, an increase in the rate of DWT from 25% to 30% would yield approximately €111m, and an increase in rate of DWT from 25% to 33% would yield approximately €178m.
As DWT is not a final liability tax, it should be noted that any increase in receipts from a higher withholding rate would represent a temporary cash-flow benefit to the Exchequer. The final liability would depend on the income tax position of the recipients of the dividends.
451. To ask the Minister for Finance the estimated revenue that would be generated in 2022 by restricting the amount an applicant can claim under the help to buy scheme from €30,000 to €20,000 and from 10% to 5% of the purchase price. [41360/21]
The Help to Buy (HTB) incentive was introduced in 2017. The measure is currently scheduled to expire on 31 December 2021. HTB gives a refund of Income Tax and Deposit Interest Retention Tax (DIRT) paid in Ireland over the previous four years, subject to limits outlined in the legislation. An increase in the supply of new housing remains a priority aim of Government policy. One of the main aims of the policy underpinning the design of HTB was to help encourage the building of additional new properties. By restricting the scheme solely to new dwellings and new self-builds, it is anticipated that the resulting increase in demand for new build homes will encourage the construction of an additional supply of such properties.
HTB was enhanced in July 2020 as part of the July Stimulus package last year and its duration was extended in Finance Act 2020. These developments were in line with the commitment in the Programme for Government regarding the measure. The following changes apply from the period from 23 July 2020 to the end of 2021:
Under the enhanced support, claimants may be eligible for increased relief under the HTB scheme to the lesser of:
- €30,000 (increased from €20,000),
- 10 per cent (increased from 5 per cent) of either the purchase price of the new home or, in the case of self builds, the completion value of the property, or,
- the amount of Income Tax and DIRT paid in the four years prior to making the application.
All other conditions of the original HTB scheme remain as before.
The following table sets out the estimated cost for each year of the scheme, including 2021 to 30 June:
|Year||Estimated Cost (€m)|
|2021 (to 30 June)||83.1|
I am advised by Revenue that the estimated yield from the proposal outlined by the Deputy, based on data for 2020, is very roughly of the order of €50m. As the enhanced scheme only operated for a portion of 2020, the estimated yield provided to the Deputy is based on all claims in 2020, taking account of the property price, the tax paid and the cap on the maximum relief. Given the effects of COVID-19 on the property market, and the possibility of behavioural effects arising as a result of the proposed change, the figure should be viewed as tentative.
452. To ask the Minister for Finance the estimated revenue that would be generated in 2022 from reducing the standard fund threshold from €2 million to €1.5 and €1.2 million respectively.; and if he will make a statement on the matter. [41361/21]
The Standard Fund Threshold (SFT) is the maximum allowable pension fund on retirement for tax purposes, which was introduced in Finance Act 2006 to prevent over-funding of pensions through tax-relieved arrangements. The threshold was initially set at €5 million. It was subsequently reduced to €2.3 million with effect from 7 December 2010 and further reduced to €2 million with effect from 1 January 2014.
Information on the numbers and values of individual pension funds or on individual accrued benefits are not generally required to be supplied to Revenue by the administrators of pension schemes and personal pension arrangements. There is, therefore, no underlying data available to Revenue on which to base reliable estimates of the savings that would arise specifically from the change to the SFT indicated in the question.