Pádraig Rice (Cork South-Central, Social Democrats)
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409. To ask the Minister for Finance if he will commit to reintroducing tax relief on trade union subscriptions; and if he will make a statement on the matter. [11498/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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Tax relief for trade union subscriptions was previously provided for under section 472C of the Taxes Consolidation Act 1997. The relief was introduced in 2001 and abolished from 2011 onward (in line with the National Recovery Plan and with a view to widening the tax base).

A review of the appropriate treatment for tax purposes of trade union subscriptions and professional body fees was carried out by the Department of Finance in 2016 and included in the 2016 report on tax expenditures published on Budget day 2016.

The review may be found at the following link: assets.gov.ie/181475/91f597c2-bd98-41d8-998e-19f14c099eea.pdf

The review concluded that:

"...analysis of the scheme using the principles laid down by the Department’s Tax Expenditure Guidelines shows that it fails to reach the evaluation threshold to warrant introduction in this manner.

The reinstatement of this tax relief would have no justifiable policy rationale and does not express a defined policy objective. Given that individuals join trade unions largely for the well-known benefits of membership, and the potential value of the relief to an individual would equate to just over €1 per week, this scheme would have little to no incentive effect on the numbers choosing to join. There is no specific market failure that needs to be addressed by such a scheme, and it would consist largely of deadweight."

In 2020, the Department of Finance carried out a further analysis which took stock of where matters stand in relation to the issue of tax relief for trade union subscriptions and set out a number of policy options for consideration. This exercise suggested that, based on certain assumptions about numbers of beneficiaries, the measure could cost at least €36.9 million if reintroduced at the same level of support as existed in 2010. However, it also drew attention to the potentially significant dead weight element which would accompany the measure.

That analysis was published with the 2020 Tax Strategy Group papers at: assets.gov.ie/86995/006fad3c-ebb5-4b0e-b067-92f8102d6e43.pdf

In relation to the question of the potential reintroduction of tax relief for trade union fees, any such decision must have regard to the sound management of the public finances and my Department's Tax Expenditure Guidelines. As the Deputy will appreciate, I must be mindful of the public finances and the many demands on the Exchequer. Tax reliefs, no matter how worthwhile in themselves, lead to a narrowing of the tax base.

I have no plans at present to reintroduce tax relief on trade union subscriptions