Dáil Éireann debate -
Thursday, 9 Apr 1992

Vol. 418 No. 6

Written Answers. - Employers' Costs.

Edward Nealon

Question:

89 Mr. Nealon asked the Minister for Finance if he will outline the estimated cost to an employer of giving a £1 net increase to (a) a single employee and (b) a married employee; if he will further provide for each case an estimate of the total amount it would cost an employer, including provision for employer's PRSI and holiday pay, to pay the average individual gross wage and the net amount this would leave in either weekly pay packet after deducting employee PAYE and PRSI; and if he will make a statement on the matter.

Minister for Finance (Mr. B. Ahern)

As the reply contains statistical data, I propose to circulate it in the Official Report.

The cost to an employer for the 1992-93 tax year, of giving a £1 net increase to an employee is estimated as follows:

(a) Single Employee 1992-93 Tax Year.

Single

Income Range	Tax Rate	PRSI and Levies Rate	Cost to Employer of £1 per week Increase
				£
Up to £3,500	Exempt	ER	14.45	1.21
		EE	5.5
£3,501 to £3,904	Marginal Relief 48%	ER	14.45	2.46
		EE	5.5
£3,905 to £10,661	27%	ER	12.2	1.72
		EE	7.75
£10,662 to £19,000	48%	ER	12.2	2.54
		EE	7.75
£19,001 to £20,300	48%	ER	12.2	2.26
		EE	2.25
£20,301 and over	48%	ER	0.0	2.01
		EE	2.25

(b) Married Employee

Married, one spouse working

Income Range	Tax Rate	PRSI and Levies Rate	Cost to Employer of £1 per week Increase
				£
Up to £7,000	Exempt	ER	14.45	1.21
		EE	5.5
£7,001 to £9,204	Marginal Relief	ER	12.2	2.54
		EE	7.75
£9,205 to £19,000	27%	ER	12.2	1.72
		EE	7.75
£19,001 to £20,236	27%	ER	12.2	1.59
		EE	2.25
£20,237 to £20,300	48%	ER	12.2	2.27
		EE	2.25
£20,301 and over	48%	ER	0.0	2.01
		EE	2.25

The cost to an employer of providing a £1 net increase in the average wage is estimated at £2.54 single-£1.72 married.

In this reply:

1. The average wage for the 1992-93 tax year is estimated as £13,200 or £253 per week and includes an element for holiday pay;

2. ER means employer's PRSI contribution, EE means employee's PRSI contribution;

3. The employee PRSI ceiling is £19,000, the employer PRSI ceiling is £20,300.