asked the Minister for Finance if he will state in respect of each year from 1955 to 1985, inclusive: (a) the tax threshold as a percentage of average male industrial earnings, for a married man with two children (wife not working); (b) the tax threshold as a percentage of average male industrial earnings for a single person; (c) the first rate of tax payable; (d) the standard rate of tax payable; (e) the standard rate of income tax; (f) the effective rate of income tax; (g) the average amount of income tax paid by the average PAYE worker; and (h) the numbers of persons currently subjected to PAYE.
Written Answers. - Tax Thresholds.
99.
The information requested is given in the following table:
|
Year |
(a) |
(b) |
(c) |
(d)/(e) |
(f) |
(g) |
(h) |
|||
|
% |
% |
£ |
000's |
|||||||
|
1955/56 |
166.7 |
62.5 |
3s.0d. |
(15%) |
7s.6d. |
(37.5%) |
2s.11d. |
(14.58%) |
43 |
138 |
|
1956/57 |
161.5 |
60.6 |
3s.0d. |
(15%) |
7s.6d. |
(37.5%) |
2s.9d. |
(13.75%) |
45 |
148 |
|
1957/58 |
156.7 |
59.7 |
3s.0d. |
(15%) |
7s.6d. |
(37.5%) |
2s.9d. |
(13.75%) |
46 |
158 |
|
1958/59 |
148.5 |
57.9 |
3s.0d. |
(15%) |
7s.6d. |
(37.5%) |
2s.7d. |
(12.92%) |
44 |
170 |
|
1959/60 |
143.2 |
56.6 |
2s.9d. |
(13.75%) |
7s.0d. |
(35%) |
2s.6d. |
(12.5%) |
44 |
180 |
|
1960/61 |
165.8 |
71.0 |
7s.0d. |
(35%) |
7s.0d. |
(35%) |
2s.6d. |
(12.5%) |
34 |
180 |
|
1961/62 |
154.3 |
67.7 |
6s.4d. |
(31.67%) |
6s.4d. |
(31.67%) |
2s.8d. |
(13.33%) |
52 |
210 |
|
1962/63 |
140.9 |
64.0 |
6s.4d. |
(31.67%) |
6s.4d. |
(31.67%) |
2s.8d. |
(13.33%) |
55 |
250 |
|
1963/64 |
134.8 |
62.4 |
6s.4d. |
(31.67%) |
6s.4d. |
(31.67%) |
2s.9d. |
(13.75%) |
59 |
275 |
|
1964/65 |
121.8 |
58.8 |
6s.4d. |
(31.67%) |
6s.4d. |
(31.67%) |
2s.7d. |
(12.92%) |
64 |
350 |
|
1965/66 |
117.2 |
57.4 |
6s.4d. |
(31.67%) |
6s.4d. |
(31.67%) |
2s.8d. |
(13.33%) |
67 |
400 |
|
1966/67 |
105.9 |
54.4 |
7s.0d. |
(35%) |
7s.0d. |
(35%) |
2s.10d. |
(14.17%) |
70 |
475 |
|
1967/68 |
106.2 |
53.1 |
7s.0d. |
(35%) |
7s.0d. |
(35%) |
2s.9d. |
(13.75%) |
75 |
530 |
|
1968/69 |
96.8 |
50.3 |
7s.0d. |
(35%) |
7s.0d. |
(35%) |
2s.9d. |
(13.75%) |
79 |
585 |
|
1969/70 |
88.6 |
47.8 |
7s.0d. |
(35%) |
7s.0d. |
(35%) |
2s.10d. |
(14.17%) |
95 |
605 |
|
1970/71 |
80.0 |
44.7 |
4s.8d. |
(23.33%) |
7s.0d. |
(35%) |
3s.0d. |
(15%) |
121 |
605 |
|
1971/72 |
73.1 |
42.3 |
35% |
35% |
15.88% |
152 |
650 |
|||
|
1972/73 |
73.7 |
43.1 |
35% |
35% |
15.35% |
192 |
650 |
|||
|
1973/74 |
66.1 |
40.3 |
35% |
35% |
16.99% |
254 |
670 |
|||
|
1974/75 (1974) |
51.8 |
21.6 |
26% |
35% |
17.89% |
315 |
670 |
|||
|
1975/76 (1975) |
47.1 |
19.6 |
26% |
38.5% |
19.95% |
404 |
680 |
|||
|
1976/77 (1976) |
43.0 |
17.9 |
26% |
38.5% |
21.47% |
549 |
680 |
|||
|
1977/78 (1977) |
39.5 |
16.6 |
20% |
35% |
22.45% |
661 |
673 |
|||
|
1978/79 (1978) |
48.4 |
19.0 |
20% |
35% |
22.48% |
749 |
699 |
|||
|
1979/80 (1979) |
53.8 |
24.4 |
25% |
35% |
24.52% |
915 |
708 |
|||
|
49.4 |
24.8 |
1,130 |
777 |
|||||||
|
1980/81 (1980) |
45.4 |
24.2 |
25% |
35% |
22.98% |
1,405 |
778 |
|||
|
1981/82 (1981) |
50.2 |
29.6 |
25% |
35% |
23.47% |
1,672 |
759 |
|||
|
1982/83 (1982) |
44.6 |
26.1 |
25% |
35% |
23.97% |
1,911 |
745 |
|||
|
1983/84 (1983) |
47.3 |
27.1 |
25% |
35% |
25.18% |
2,270* |
741* |
|||
|
1984/85 (1984) |
46.3 |
26.4 |
35% |
35% |
N/A |
2,490* |
735* |
|||
|
1985/86 (1985) |
35% |
35% |
N/A |
* These figures are provisional.
General Note
The figures in columns (a) to (h) inclusive relate to the tax year specified except in the case of column (g) in relation to which, for the years subsequent to 1973-74, the figures are based on the PAYE net receipt in the financial year indicated in brackets.
Notes on table
Columns (a) and (b):
(i) Personal Allowances:
From 1955-56 to 1973-74, inclusive, the allowances assumed for the married man were the married allowance, child allowance for two children not over 11 years of age and earned income relief. For the same period the allowances assumed for the single person were the single allowance plus earned income relief. Earned income relief was abolished with effect from 6 April 1974.
From 1979-80 onwards the single, married and child allowances have been augmented by the additional of the special employment deduction (PAYE allowance).
From 1982-83 onwards account has been taken of the PRSI allowance.
As regards column (a), for each of the years 1955-56 to 1967-68, the effective exemption limits (married and child allowances together with related earned income relief) exceeded the average industrial earnings for male workers. This is reflected in the figures for those years in that column.
(ii) Average male industrial earnings:
Up to and including 1968-69 average industrial earnings relate to males of 18 years of age or over employed in transportable goods industries and are based on the amounts earned in a week in October of each year. Owing to a change in the method of collection and classification of the amounts of such earnings, the earnings from 1969-70 onwards relate to a male of 21 years of age or over and are based on quarterly figures which have been averaged for each tax year shown in the table.
Up to and including 1973-74 the earnings figures are derived from the annual censuses of industrial production. For subsequent years, the earnings are based on the new NACE system of industrial classification (general classification of economic activities within the European Communities).
Column (d)/(e):
The 38.5% standard rate of income tax which is shown for 1975-76 and 1976-77 is comprised of the standard rate of 35% plus the temporary 10% surcharge which applied to all income tax rates for those years except the first rate.
There is no apparent difference between the questions at (d) and (e). Consequently, the relevant information is given under one heading, (d)/(e), in the table.
Column (f):
Effective rate of income tax:
This is the average effective rate of tax levied on each pound of Actual Income as defined in the Revenue Commissioners' Annual Reports.
The latest available published information is that contained in table 90 of the report for year ended 31 December 1984 copies of which are in the Library.
Column (g):
(i) PAYE was introduced with effect from October 1960. It applied at that time to all employees except those for whom a statutory tax deduction scheme was already in operation (public servants, officials of Bank of Ireland, etc.). PAYE was extended to all employees as from the year 1976-77. For years prior to 1976-77 tax payments in respect of all persons (including public servants) taxed under Schedule E have been taken into account.
A breakdown of the net receipt of income tax attributable to Schedule E is not available for years up to and including 1962-63. For these years the estimated net produce of that tax has been used. Net produce of tax is the estimated ultimate yield from the tax assessed in the year, whether actually collected in that year or later, after deducting all discharges and remissions and setting off all repayments. For years between 1963-64 and 1976 it is possible to make a reasonably reliable estimate of the net receipt of Schedule E tax using actual figures of tax payments under PAYE. The net receipt figures for PAYE for years subsequent to 1976 are separately distinguished from other tax receipts in the collection process.
The amounts shown in the column are obtained by dividing the net receipt or net produce, as the case may be, by the number of persons shown for the corresponding tax year in column (h).
(ii) The reduction in income tax paid in 1960-61 is attributable to the abatement estimated at over £4 million given under section 14 of the Finance (No. 2) Act, 1959.
Column (h):
The numbers shown in this column are the numbers of taxpaying units estimated to be effectively liable to tax under Schedule E up to and including the year 1975-76 and those liable under PAYE in subsequent tax years. A married couple who have elected or have been deemed to have elected to have the income of both spouses assessed on the husband are counted as one taxpaying unit.