Paschal Donohoe (Dublin Central, Fine Gael)
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In 2008 the value of the single personal and the employee tax credits amounted to €1,830 per annum. In 2022, the personal and employee tax credits amount to €1,700 per annum. This represents a cumulative reduction of around 7 per cent when compared with 2008.

Developments in average pay were distorted during the pandemic by large movements in to, and out of, the workforce, in particular by lower paid workers in contact-intensive sectors. As such, the insight from that period is limited by that volatility in the series. However, average wages increased by around 13 per cent in 2019 (i.e. immediately pre-pandemic) compared to 2008.

As the Deputy will be aware, a number of other important structural income tax changes, including the introduction of the Universal Social Charge (USC), were implemented over this period, primarily to raise revenue and also to address some of the structural weaknesses within the Irish income tax system that was a key contributor to Ireland's sovereign debt crisis.

It is important to point out that tax credit changes should not be considered in isolation but viewed in conjunction with the broad suite of income tax changes introduced over the period and within the fiscal parameters that were available.

Tax revenue from the USC amounted to €4.4 billion in 2021. My Department is projecting this to increase to approximately €4.8 billion this year.

There was no Exchequer surplus recorded in 2008 and a surplus is not currently projected for 2022. Instead, the Exchequer recorded a deficit of €4.8 billion in 2008 while, in the Stability Programme Update 2022published in April, my Department projected an Exchequer deficit of €1.1 billion this year.