Dáil Éireann Debate, Thursday - 18 September 2014
80. Deputy Brendan Griffin asked the Minister for Finance the immediate costs to the Exchequer of lowering the standard and higher rates of income tax; if he will provide examples in tabular form of decreases by 0.5%, 1%, 1.5% and 2%; the number of taxpayers who would be affected and the costs involved; his views that action on this would be an effective way of easing the tax burden for workers; and if he will make a statement on the matter. [34951/14]
View answerI am informed by the Revenue Commissioners that the estimated first and full year costs, with reference to 2015 incomes, of decreasing the standard rate of income tax by 0.5%, 1%, 1.5% and 2% and the numbers affected by such decreases are as detailed in the following table.
|
Rate Decrease |
First Year Cost to the Exchequer €m |
Full Year Cost to the Exchequer €m |
Numbers Affected |
|
0.5% |
188 |
254 |
1.4m |
|
1% |
374 |
506 |
1.4m |
|
1.5% |
558 |
754 |
1.4m |
|
2% |
738 |
1,000 |
1.4m |
I am also informed that the estimated first and full year costs, with reference to 2015 incomes, of decreasing the higher rate of income tax by 0.5%, 1%, 1.5% and 2% and the numbers affected by such decreases are as detailed in the following table.
|
Rate Decrease |
First Year Cost to the Exchequer €m |
Full Year Cost to the Exchequer €m |
Numbers Affected |
|
0.5% |
82 |
117 |
.7m |
|
1% |
164 |
234 |
.7m |
|
1.5% |
246 |
350 |
.7m |
|
2% |
328 |
467 |
.7m |
These figures are estimates from the Revenue tax forecasting model using latest actual data for the year 2012, adjusted as necessary for income, self-employment and employment trends in the interim. They are provisional and may be revised. Married persons or civil partners who have elected or have been deemed to have elected for joint assessment are counted as one tax unit.
The Deputy will be aware that I am on record stating that I believe that the burden of income tax in Ireland is too high and that it is my intention to reduce it when the state of the public finances allows me to do so. Furthermore, the recent Government Statement of Priorities contains a commitment to include a tax reform plan with the upcoming Budget, setting out how the Government will reduce the 52% marginal rate of income tax on low and middle income earners over a number of years.
