Pearse Doherty (Donegal, Sinn Fein)
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342. To ask the Minister for Finance the estimated cost of extending the 9% rate of VAT applicable to electricity and gas from 28 February to end-March and end-June 2023, respectively. [1399/23]

Pearse Doherty (Donegal, Sinn Fein)
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385. To ask the Minister for Finance the estimated cost of extending the reduced 9% VAT rate applicable to electricity and gas from beginning of March 2023 to end-June 2023 and end-2023 respectively. [2401/23]

Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 342 and 385 together.

I am advised by Revenue that traders are not required to identify the VAT yield generated from the supply of specific goods and services on their VAT returns. Therefore, it is not possible to provide a costing for the measures outlined above using information provided on tax returns.

However, tentative estimates using third-party data sources and the most recently available consumer price indices for electricity and gas are provided below. These estimates do not account for any behavioural changes and are subject to revision should the volatility in gas and electricity prices continue over the short to medium term.

Pearse Doherty (Donegal, Sinn Fein)
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343. To ask the Minister for Finance the estimated cost of extending the reduced rate of excise duty that applies to petrol from end-February to end-March and end-June 2023 respectively. [1402/23]

Pearse Doherty (Donegal, Sinn Fein)
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344. To ask the Minister for Finance the estimated cost of extending the reduced rate of excise duty that applies to diesel from end-February to end-March and end-June 2023 respectively. [1403/23]

Pearse Doherty (Donegal, Sinn Fein)
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345. To ask the Minister for Finance the estimated cost of applying a zero rate of excise duty to home heating oil from 1 February to end-March and end-June, and from 1 March to end-March and end-June 2023 respectively. [1404/23]

Pearse Doherty (Donegal, Sinn Fein)
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384. To ask the Minister for Finance the estimated cost of reducing the rate of excise applicable to home heating to €0 per 1,000 litres in line with the Energy Tax Directive from 1 March to end-June and end-2023 respectively. [2347/23]

Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 343 to 345, inclusive, and 384 together.

I am advised by Revenue that the estimated cost of extending the reduced Mineral Oil Tax (MOT) rates for the periods outlined, in respect of petrol and diesel, are shown in the following tables.

In relation to Questions 1404/23 and 2347/23, I am advised by Revenue that the Mineral Oil Tax charge on heating kerosene is comprised of a non-carbon component currently set at €0.00 and a carbon component, currently set at €103.83 per 1,000 litres and scheduled to increase to €122.83 in May. The cost of reducing the carbon component to zero cents per 1,000 litres for the timeframes set out in the question are contained in the following table.

These estimates are based on the most recent consumption data available and do not account for any behavioural changes.

Carol Nolan (Laois-Offaly, Independent)
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346. To ask the Minister for Finance if the tax benefits enjoyed by married couples are sufficient in order to incentivise couples to get married at the present time; if he proposes to further incentivise marriage through the taxation system; and if he will make a statement on the matter. [1427/23]

Michael McGrath (Cork South Central, Fianna Fail)
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Following clarification from the Deputy’s office, I understand that the purpose behind the question is to seek an update on the policy position with regard to individualisation of the personal income tax system.

Accordingly, it may be helpful first of all to summarise the background to the current position in relation to individualisation.   

Prior to 2000, the income tax system allowed for full joint assessment of married couples.  This meant that a married one earner couple could use the combined tax credits and standard rate band available to both individuals – i.e. double the personal tax credit and standard rate band available to a single earner.  As a result, where the primary earner of a married couple had sufficient income to use the available reliefs in full, the second earner faced the marginal rate of income tax from the first pound of income earned, which acted as a disincentive to workforce participation for second earners. 

A process of moving towards an individualised system of income taxation began in the tax year 2000/2001 with initial steps being taken to individualise the tax bands.  The stated economic objective behind the move was to increase labour force participation and reduce the numbers of workers paying the higher rate of income tax.  It should be noted that many European countries have made similar moves towards a partial or fully individualised income taxation system on the grounds that it improves equality and economic independence for women.   

As the Deputy may be aware, the policy of individualisation never advanced beyond the initial step outlined above.

The result is that we now have a hybrid system, which has been maintained for over 20 years. For example, up to €9,000 of the standard-rate band can be transferred between spouses and the married personal tax credit, can be allocated in full to one spouse. As the income tax system allows married couples and civil partners to choose whether to be jointly or individually assessed, there can be a difference between the tax liabilities incurred by married/civil partner one-earner couples compared to married/civil partner two-earner couples on the same household income, depending on the method of assessment chosen.

However, in lieu of fully transferable rate bands, a Home Carer Tax Credit may be claimed where one spouse works primarily in the home to care for a dependent person, such as a child. This credit was introduced in the context of the move towards individualisation, in recognition of the choices made by families where one spouse stays at home to care for children or the elderly.   In recent years, the value of the credit has been increased in line with a commitment in the Programme for Government and it now stands at €1,700 for the current tax year. 

It is also worth pointing out that both the PRSI and Universal Social Charge are already applied on an individualised basis.

The issue of tax individualisation was considered by the recent Commission on Taxation and Welfare (CoTW) and, it recommended a phased move towards individualisation of the Standard Rate Cut Off Point as a step towards addressing disparities in the income tax system, facilitating increased employment, and decreasing the gap in the employment rate between men and women.  Further details are set out in the Report of the Commission, located at the following link - www.gov.ie/en/publication/7fbeb-report-of-the-commission/. 

As signalled in the Budget, my Department has begun initial work on developing a medium-term roadmap for personal tax reform, taking account of the recent report of the CoTW, and considering a range of measures across income tax, USC and PRSI together with other related personal taxation issues.

All the above will help inform deliberations relating to aspects of the income tax system in the context of future Budgets.