Michael Fitzmaurice (Roscommon-Galway, Independent)
Link to this: Individually | In context | Oireachtas source

122. To ask the Minister for Finance if the 3% USC surcharge on income in excess of €100,000 for the self-employed will be reviewed to bring it in line with that of the employed; and if he will make a statement on the matter. [37812/24]

Jack Chambers (Dublin West, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The origins of the 3% USC surcharge, that applies on non-PAYE income in excess of €100,000 per annum, go back to Budget 2011 when the USC was first introduced, where significant changes to PRSI took place in parallel with the introduction of the USC and the abolition of the Health and Income Levies.

The 3% surcharge was introduced to ensure that the relative position as regards the top marginal tax rates for PAYE income earners (52%) and self-employed income earners (55%) remained unchanged when compared with the position before Budget 2011.

The current Programme for Government contains a commitment that proposals will be considered to ameliorate this over time as resources allow. However, it is important to note that abolishing or reducing the USC surcharge on non-PAYE income would result in a reduction in the overall tax yield, thus raising the question of providing for an alternative revenue stream.

While the personal income tax measures included in the last number of Budgets have benefitted all taxpayers who pay income tax or USC, the personal income tax policy decisions of this government have had a particular focus on low and middle income earners, having regard to cost of living pressures which impact may those households the most.

As the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.

Lastly, I should mention that my Department completed a review of the personal tax system which was published on Budget Day last year. The report encompasses analysis of the Income Tax and USC structure, and is available at the following link: www.gov.ie/pdf/?file=https://assets.gov.ie/273335/96f70eb1-64e1-4f02-9096-e36f306a048b.pdf#page=null .