Dáil Éireann debate -
Tuesday, 25 Mar 1997

Vol. 476 No. 7

Written Answers. - Tax Reliefs.

Noel Ahern

Question:

89 Mr. N. Ahern asked the Minister for Finance if he will examine the tax position of an old age pension couple, both over 80 years of age, who lost out in the 1997 budget and whose tax free allowance will be lower in the financial year 1997-98 than in 1996-97; if he will bring forward alterations in the Finance Bill to increase the exemption limits for old age pensioners to allow them to benefit from 1997 budget changes; and if he will make a statement on the matter. [8149/97]

Minister for Finance (Mr. Quinn)

I would draw to the Deputy's attention that the income tax changes I introduced in this year's budget are of benefit to old age pensioners. If being taxed under the normal tax system a couple, both over 80 years of age, will benefit from the £500 increase in the married couples personal allowance to £5,800 and also from the doubling of the age allowance for a married couple to £800.

If the couple are being taxed under the marginal relief system their exemption limits will be increased by £200 to £10,400. Consequently, in this year's budget the amount of the couple's income exempted from tax has been increased compared to the 1996-97 tax year whether the couple are being taxed under the normal tax system or the marginal relief system.

Noel Ahern

Question:

90 Mr. N. Ahern asked the Minister for Finance the number of pensioners or number of people claiming the tax age allowance who are also on the tax exemption band and paying at the marginal 40 per cent rate; and the total estimated annual amount of tax paid by this group. [8150/97]

Minister for Finance (Mr. Quinn)

I am advised by the Revenue Commissioners that income tax statistics do not generally distinguish between individuals who have income from pensions and from other sources. The only relevant information available is in respect of all individuals aged 65 years or over, including individuals with income from pensions, who are estimated to qualify for a reduced liability to income tax under marginal relief.

Following the enactment of the changes announced in this year's budget, it is estimated that approximately 27,000 taxpayers aged 65 years or over will pay tax under the marginal relief system in the income tax year 1997-98. The amount of tax liability involved is estimated to be of the order of £20 million in the tax year 1997-98.

These figures are provisional and are likely to be revised.