Dáil Éireann Debate, Wednesday - 11 February 2015
50. Deputy Peadar Tóibín asked the Minister for Finance if he will provide, in tabular form, the projected increase in tax revenue in 2015 if the national minimum wage was increased to €9.65; to €10.65; and to €11.45. [6302/15]
View answerI am informed by the Revenue Commissioners that workers earning the minimum wage are not separately identified on Revenue records, and therefore it is not possible to estimate the additional yield to the Exchequer from increasing the minimum wage as outlined. The complexities of estimating the increased yield from income taxation would require, among other information, details of (i) the number of hours worked by the relevant individuals, (ii) whether they are singly or jointly assessed, and (iii) how tax credits are assigned between spouses.
Furthermore, increases in the minimum wage would be an additional cost for employers and thus would presumably have a negative effect on profits, leading to a reduction in Schedule D Income Tax and Corporation Tax receipts. In cases where employers could not afford the new minimum wage rates, it is possible that job losses could be experienced further reducing the potential yield from such a measure.
Notwithstanding the above however, for illustrative purposes, estimated examples of the increases in Income Tax / USC that could arise for individuals, as a result of the increases specified by the Deputy, are set out in the table below. For the purposes of the illustration, it is assumed that the taxpayer is single, working 39 hours per week, and taxed at the standard rate of tax. Rounding may affect totals.
|
Minimum Wage |
Additional Income Tax per annum |
Additional USC per annum |
Total |
|
€/ph |
€ |
€ |
€ |
|
9.65 |
604 |
197 |
800 |
|
10.65 |
1,068 |
254 |
1,322 |
|
11.45 |
1,793 |
653 |
2,446 |
