Colm Burke (Cork North-Central, Fine Gael)
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294. To ask the Minister for Finance if consideration will be given to removing the extra USC charge of 3% that applies to any self-employed income over €100,000; and if he will make a statement on the matter. [9027/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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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.

It is important to acknowledge 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. Reductions to the tax base make general reform of the tax system that much more difficult.

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

I should also mention that my Department completed a review of the personal tax system which was published on Budget Day 2023. The report encompasses analysis of the Income Tax and USC structure, and is available at the following link: .

The current Programme for Government commits to implementing progressive changes to personal income tax if the economy remains strong, including indexing credits and bands to prevent an increase in the real burden of income tax. Any potential revisions to personal income tax will be considered in this light as part of the budgetary process.