Dáil Éireann debate -
Tuesday, 26 Nov 1996

Vol. 472 No. 1

Written Answers. - Tax Relief.

Bertie Ahern

Question:

110 Mr. B. Ahern asked the Minister for Finance the estimated full-year budget day cost of income tax and employee PRSI measures in each of the years from 1994 to 1996 during the lifetime of the Programme for Competitiveness and Work. [22519/96]

Minister for Finance (Mr. Quinn)

The estimated full year budget day cost of the total income tax, 1 per cent income levy, health contribution and employment and training levy, and employee PRSI changes introduced in the 1994, 1995 and 1996 budgets are as follows:

	Full Year Cost
Budget	£m
1994	303
1995	199
1996	171

It should be noted in particular that the 1994 figure includes the cost of abolishing the 1 per cent income levy and the full year yield from making unemployment benefit reckonable as income for tax purposes. The 1995 figure takes into account the full yield arising from the restriction in tax relief for covenants introduced in the 1995 budget.

The 1995 and 1996 figures respectively include the effect of the reduction and non-renewal of the PRSI income tax allowance. The yield from the phased standard rating of income tax relief on mortgage interest and medical insurance premiums has been allocated to the year in which the incremental increases in yield actually arise.

Bertie Ahern

Question:

111 Mr. B. Ahern asked the Minister for Finance the cumulative income tax and employee PRSI relief under each of the three national programmes to date; and the way in which such relief is calculated. [22520/96]

Minister for Finance (Mr. Quinn)

The cumulative income tax and employee PRSI relief provided under each of the three national programmes is estimated to be as follows:

	Full Year Cost
	£m
PNR	550
PESP	287
PCW	673

The above figures are based on the full year cost of the changes introduced in the areas of income tax, 1 per cent income levy, health contribution and employment and training levy, and employee PRSI in the three budgets arising during each national programme. The figures, therefore, take account also of increases in the income tax area introduced in the relevant budgets. The data is drawn up on the same basis as that entered in the reply to Question No. 110 for answer also today.

It should be noted in particular that theProgramme for Economic and Social Progress figure includes the increased full year yield, £130 million, arising from the introduction of the 1 per cent income levy in 1993 and the Programme for Competitiveness and Work figure includes the cost of abolishing the levy in 1994, £135 million.

Bertie Ahern

Question:

112 Mr. B. Ahern asked the Minister for Finance the basis for the £800 million relief mentioned by a senior official in his Department as available for tax relief over the next three years; the assumptions which underlie this figure; and whether the same method of calculation is being used as under previous programmes. [22521/96]

Minister for Finance (Mr. Quinn)

The question refers to a presentation made by Mr. Michael Tutty, second secretary in charge of the budget and economic division in my Department, to the social partners in the context of discussions on a new National Programme. I circulated a summary of this presentation to all Deputies and Senators on 12 November which includes a full overview of the budgetary and economic considerations which need to be taken into account over the next three years. The method of calculation used is similar to that used previously.