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Dáil Éireann debate -
Tuesday, 21 Feb 1984

Vol. 348 No. 2

Written Answers. - Tax Figures.

386.

asked the Minister for Finance the cost to the Exchequer (a) if advance corporation tax was abolished and (b) if the first £500 of VAT was allowable against administrative costs to all registered businesses for VAT.

Following is the information requested:

(a) The cost to the Exchequer of abolishing advance corporation tax, to which applies the transitional arrangement whereby only one-half of the tax is payable in respect of distributions, is estimated at £5 million in a full year. The corresponding loss from the abolition of advance corporation tax if it were payable at the full rate is estimated at £10 million.

(b) It is estimated that the annual cost to the Exchequer would be £30 million if registered traders having net annual VAT liability in excess of £500, were permitted to retain £500 per year against administration costs and if persons with an annual liability of less than £500 were allowed relief up to the amount of the tax payable. Such an arrangement would, however, provide full benefit for only some 54,000 traders out of the total number registered of approximately 97,000. Of the remaining 43,000 it is estimated that a relatively small number would receive varying sums less than £500 depending on the amount of their annual liability while the vast majority would not receive any benefit, as they are, in general, in a permanent VAT repayment situation.

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