asked the Minister for Finance if the loss to the Exchequer from the operation of the PAYE allowance is less than the loss to the Exchequer from the concession which allows self-employed persons to be taxed on a previous year basis; and the amount of the difference.
Written Answers. - PAYE Allowance.
73.
I am informed by the Revenue Commissioners that the operation of the PAYE allowance in 1987-88 will cost the Exchequer an estimated £252 million in tax revenue foregone. This is a provisional estimate which may be revised at a later date.
It is not possible at present to give any estimate of the revenue gain to the Exchequer which would result if self-employed taxpayers were assessed to income tax on their income in a current year. So many complex factors must be allowed for that it is difficult to develop a satisfactory basis for such a calculation. I should point out, however, that it is not clear that there is any necessary connection between the cost of the PAYE allowance at present and the gain which would result if self-employed taxpayers were assessed to income tax on their income in a current year, since, among other factors, the numbers of taxpayers involved in the two sectors are substantially different.