Pearse Doherty
Question:28. Deputy Pearse Doherty asked the Minister for Finance the way the planned tax cuts in 2016 announced by him will be in line with the expenditure benchmark and the Stability and Growth Pact. [4652/15]
View answerWednesday, 4 February 2015
Questions (28)
Written answers
As the Deputy will be aware, the Statement of Priorities issued by the Government in July 2014 included a commitment for an income tax reform plan to be delivered over a number of budgets, to reduce the 52% marginal tax rate on low and middle-income earners, in a manner that maintains the highly progressive nature of the Irish tax system.
The first stage of the plan was given effect in Budget 2015 when the marginal rate of income tax was reduced from 41% to 40% and the standard rate band was extended by €1,000 to €33,800 for a single individual, which is above the average industrial wage. The standard rate band was also extended by €1,000 to €42,800 for jointly assessed married one earner couples and by €2,000 to €67,600 for married two earner couples. In addition, the Budget also contained USC measures which provided tax relief for those on lower incomes, as well as limiting the benefits that could accrue to those on higher incomes.
I have stated many times in the House that I intend to further reduce the marginal rates of income tax in a similar manner to last year's changes. This would be subject to having the required fiscal space available or through a refocus of the tax system. However, decisions on specific taxation measures will be considered in the context of the annual budgetary process.