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Dáil Éireann debate -
Thursday, 5 Nov 1992

Vol. 424 No. 10

Ceisteanna — Questions. Written Answers. - Farmer Taxation.

Michael D. Higgins

Question:

37 Mr. M. Higgins asked the Minister for Finance if he will outline the total income tax paid by farmers in each of the three years ending 5 April 1992; and if he will make a statement on the matter.

Jim Kemmy

Question:

47 Mr. Kemmy asked the Minister for Finance if he will outline (1) the number of farmers who opted for the self assessment income tax system since its introduction and (2) the total tax paid through this system in the three years ending 5 April 1992; and if he will make a statement on the matter.

I propose to take Questions Nos. 37 and 47 together.

Statistics of the amounts of income tax paid on farming profits are available by calendar year. The estimated amounts paid in the three years ending 31 December 1991 were £50 million in 1989, £45 million in 1990 and £36 million in 1991.

It should be noted that these figures include the estimated tax paid by trader-farmers on their farming profits but do not include the tax paid under PAYE on the income from employment of farmers or their spouses.

The reduction in the tax yield on farming profits since 1989 is mainly attributable to a reduction in farm incomes in 1990 and 1991. The yield from farmers in 1991 was further reduced by the once-off effect of deferring payment of the balances of 1990/91 tax from 1991 to 1992. Ordinarily these balances, *amounting to about £5 million, would have been paid in 1991 but were deferred to 1992 as a transitional effect of introducing the current year basis of assessments for self-employed persons in 1990.

The new tax arrangements introduced in 1988 for all self-employed persons, including farmers — generally referred to as the self assessment system — imposed on each chargeable person the obligation to pay preliminary tax if liable and to furnish, without notification from an inspector of taxes, a completed tax return. An inspector of taxes can, however, by written notification exclude an individual from the obligation to file a return.

Under the new system taxpayers are not

* The balances are for the remaining tax amounts for the year in question that fall to be paid after the preliminary tax payment.

required to actually calculate their final liability to tax but a voluntary self-assessment facility is available for those who wish to avail of it.
The number of individuals with income from farming who are expected to furnish completed tax returns in respect of the income tax year 1991-92 is estimated at 67,000 but statistics are not available as to the numbers who might avail of the facility for voluntary calculation of tax due. A further 18,000 farmers are on tax record as having been notified by inspectors of taxes that a tax return is not required from them until their position is further reviewed.
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