Pearse Doherty (Donegal, Sinn Fein)
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240. To ask the Minister for Finance the total number of individuals subject to high-income individuals' restriction; the estimated additional income tax raised each year since 2007, in tabular form; to outline any reasons for the severe drop-off in the number of individuals subject to the tax and the falling revenue; and if he will make a statement on the matter. [40539/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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The restriction of reliefs' measure for individuals on high incomes, who make significant use of certain specified tax reliefs, was announced in Budget 2006 and came into effect from 1 January 2007. The intention of the restriction is to seek to improve the balance between promoting tax equity in relation to those on high incomes while at the same time maintaining the incentive effect of the various tax reliefs introduced to achieve a particular public good.

The measure limits the use of certain tax reliefs and exemptions by those on high incomes. Prior to the introduction of this restriction, such individuals, by means of the cumulative use of various tax incentive reliefs, had been able to reduce their tax liability to very low levels. The restriction works by limiting the total amount of specified reliefs that a high income individual can use to reduce his or her tax liability in any one tax year.

The restriction, as introduced, ensured that individuals with adjusted income exceeding €500,000 paid at least an effective rate of tax of approximately 20% on that income. Where adjusted income was between €250,000 and €500,000, a tapering system ensured that there was a graduated introduction of the restriction, with the effective rate of tax increasing towards 20% as adjusted income increased towards €500,000.

Finance Act 2010 Act introduced further limitations on the use of specified reliefs, with effect from 1 January 2010. These limitations ensure that individuals with an adjusted income level of €400,000 or more (where the full restriction applies) pay an effective rate of Income Tax of approximately 30 per cent on a combination of adjusted income and ring-fenced income (ring-fenced income is income that is normally liable to tax at a specific rate, which is lower than the higher rate of income tax such as applies in the case of Deposit Interest Retention Tax). In addition, the adjusted income on which the restriction begins to apply was reduced to €125,000 or greater.

I am informed by Revenue that the most recent year for which data in relation to the High-Income Individuals’ Restriction is available is 2022. Data for 2023 will be available in the coming weeks and will be published the Revenue website at . Data for 2024 is not available as the filing deadline in relation to self-assessed taxpayers has not yet passed.

The table below shows the number of Individuals subject to this restriction and the estimated additional yield in Income Tax for the years 2007-2022.