asked the Minister for Finance if, in relation to his replies of 26 October 1988 to Parliamentary Questions Nos. 68, 70, 71, 72, 73, 74 and 75, he will extend the data made available to the Estimates for the tax year 1988-89.
Written Answers. - Income Tax Allowances.
66.
Following is the additional information requested in so far as it is available. The information is identified with the previous questions by reference to their numbers on the Order Paper for 26 October 1988.
Question No. 68
Estimated Cost to the Exchequer
|
Allowance or Relief |
1988-89 |
|
£million (Provisional) |
|
|
Personal income tax allowances: |
|
|
Married |
753.0 |
|
Single |
415.0 |
|
Widowed |
57.0 |
|
One-parent family |
14.2 |
|
Employee (PAYE) |
286.0 |
|
PRSI |
84.0 |
Question No. 70
|
1988-89 |
|
|
(Provisional) |
|
|
Estimated number of persons effectively liable to income tax |
951,000 |
|
Estimated number of taxpaying units |
819,000 |
Estimated distribution of taxpaying units by income tax band
|
Marginal Rate band |
Number |
Percentage of total |
|
% |
000s |
% |
|
Exemption limits — 60% rate for marginal relief |
33 |
4.0 |
|
35 |
481 |
58.7 |
|
48 |
162 |
19.8 |
|
58 |
143 |
17.5 |
|
Totals |
819 |
100 |
As regards the amounts of tax realised from each band, the latest relevant statistics showing the yield by range of taxable income relate to the years 1984-85 and 1985-86 and are set out in the following table:
TABLE
Income Tax 1984-85 and 1985-86.
Distribution of (i) number of taxable incomes (ii) total taxable income and (iii) tax, by range of taxable income.
|
1984-85 |
1985-86 |
||||||
|
Range of taxable income |
Number of cases |
Taxable Income |
Tax |
Number of cases |
Taxable Income |
Tax |
|
|
Over |
Not Over |
||||||
|
£ |
£ |
£ |
£ |
£ |
£ |
||
|
0 |
1,000 |
69,771 |
35,207,504 |
11.643,997 |
67,682 |
33,972,316 |
11,207,429 |
|
1,000 |
2,000 |
78,263 |
118,095,840 |
39,144,708 |
74,023 |
111,659,877 |
36,214,129 |
|
2,000 |
3,000 |
80,124 |
200,405,136 |
68,678,609 |
74,524 |
186,121,574 |
63,195,279 |
|
3,000 |
4,000 |
87,629 |
307,359,008 |
106,549,048 |
76,872 |
269,439,864 |
93,059,411 |
|
4,000 |
5,000 |
84,828 |
380,518,050 |
135,011,935 |
80,487 |
361,352,409 |
126,391,094 |
|
5,000 |
6,000 |
72,408 |
397,204,368 |
145,280,869 |
69,369 |
380,305,063 |
138,077,891 |
|
6,000 |
7,000 |
58,495 |
378,966,253 |
142,254,398 |
57,815 |
374,311,880 |
139,438,664 |
|
7,000 |
8,000 |
47,362 |
354,453,750 |
136,675,577 |
48,093 |
360,194,113 |
136,911,908 |
|
8,000 |
9,000 |
39,569 |
335,184,914 |
132,556,594 |
41,175 |
348,872,084 |
136,011,192 |
|
9,000 |
10,000 |
30,889 |
293,123,882 |
118,312,283 |
33,573 |
318,551,855 |
127,103,143 |
|
10,000 |
12,500 |
53,216 |
592,010,035 |
246,168,270 |
59,706 |
664,470,873 |
273,903,330 |
|
12,500 |
15,000 |
29,318 |
399,504,910 |
174,164,545 |
33,473 |
456,544,491 |
194,088,408 |
|
15,000 |
17,500 |
16,565 |
267,508,114 |
120,572,024 |
19,480 |
314,449,379 |
138,011,121 |
|
17,500 |
20,000 |
10,579 |
197,378,083 |
93,105,958 |
11,956 |
222,968,002 |
102,038,083 |
|
20,000 |
25,000 |
10,787 |
238,766,691 |
127,935,010 |
12,592 |
278,819,439 |
132,805,455 |
|
25,000 |
30,000 |
4,757 |
129,322,945 |
70,566,950 |
5,283 |
143,572,813 |
71,551,288 |
|
30,000 |
35,000 |
2,236 |
72,216,798 |
40,034,692 |
2,459 |
79,112,932 |
40,549,157 |
|
35,000 |
40,000 |
1,400 |
52,185,807 |
29,369,282 |
1,376 |
51,255,641 |
26,840,677 |
|
40,000 |
50,000 |
1,383 |
61,400,855 |
35,267,970 |
1,325 |
58,584,146 |
31,364,948 |
|
Over |
50,000 |
1,877 |
152,745,550 |
91,995,734 |
1,833 |
152,487,685 |
85,916,058 |
|
Totals |
781,456 |
4,963,558,493 |
2,065,288,453 |
773,096 |
5,167,046,436 |
2,104,678,665 |
Notes on Table:
(1) The information relating to employees from whose income tax was deducted under PAYE is necessarily somewhat restricted in coverage because all end of year returns were not capable of being processed at the time the information in the tables was being complied.
(2) Taxable income is that part of income on which tax is actually calculated. It is thus the total income of taxpayers less personal reliefs and other deductions.
Question No. 71
Statistics on which to base a reliable estimate of the cost to the Exchequer of the reliefs and allowances listed in this question are not available in respect of the 1988-89 tax year. The tax relief provided for retirement annuity premiums paid by the self-employed is tentatively estimated to involve a cost of the order of £20 million in terms of tax foregone in the current tax year.
Question No. 72
Following is the estimated cost to the Exchequer which would have arisen if indexation of the employee (PAYE) allowance and the income tax rate bands had been provided for in the 1988 Budget instead of the actual increases which were granted:
|
1988 |
Full Year (1988-89) |
|||
|
Indexation |
Actual increase |
Indexation |
Actual increase |
|
|
£m |
£m |
£m |
£m |
|
|
(a) Employee (PAYE) allowance |
2.8 |
21.3 |
4.7 |
35.8 |
|
(b) Income tax rate bands |
6.5 |
52.4 |
10.8 |
87.1 |
The estimates are based on an assumed increase in inflation of 2 per cent in 1988-89 compared with the corresponding level in 1987-88.
Question No. 73
|
Annual net disposable income |
Annual net disposable income |
|||||
|
(i) Earnings equivalent to adult male average industrial wage |
(ii) Earnings equivalent to adult female average industrial wage |
|||||
|
Tax Year |
(a) |
(b) |
(c) |
(a) |
(b) |
(c) |
|
Married persons |
Married with two children |
Single persons |
Married persons |
Married with two children |
Single persons |
|
|
1988-89 |
8,942.73 |
8,942.73 |
7,684.01 |
6,137.48 |
6,137.48 |
5,419.98 |
Question No. 74
|
Tax threshold as percentage of average male industrial earnings |
Effective rate of income tax for a worker on average male industrial earnings |
|||||
|
Tax Year |
(a) |
(b) |
(c) |
(a) |
(b) |
(c) |
|
Married persons |
Married with two children |
Single persons |
Married persons |
Married with two children |
Single persons |
|
|
% |
% |
% |
% |
% |
% |
|
|
1988-89 |
41.7 |
41.7 |
25.2 |
20.4 |
20.4 |
30.5 |
Question No. 75
Estimated cost to the Exchequer
|
Allowance or Relief |
1988-89 |
|
£ million |
|
|
Export sales relief |
not available |
|
“Shannon” relief |
not available |
|
Manufacturing profits — reduced rate of tax |
not available |
|
Stock relief |
0.4 (1988) (Provisional) |
|
Capital Allowances |
|
|
Accelerated |
not available |
|
Other |
not available |
|
Reduced rate of corporation tax for small companies |
not available |
|
“Section 84” loans |
not available |
Note: Where appropriate the explanatory notes which accompanies the replies given on 26 October, 1988 are also relevant to this answer.