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Tax Yield

Dáil Éireann Debate, Tuesday - 6 November 2018

Tuesday, 6 November 2018

Questions (166, 167, 168, 169, 208, 209, 210)

Peter Burke

Question:

166. Deputy Peter Burke asked the Minister for Finance the estimated cost of increasing the point at which a single worker pays the higher rate of income tax by amount and year (details supplied) with prorate changes to the point at which a single income couple pay the higher rate and a dual income couple does. [44668/18]

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Peter Burke

Question:

167. Deputy Peter Burke asked the Minister for Finance the estimated cost of increasing the point at which a single worker pays the higher rate of income tax by amounts and year (details supplied) with prorate changes to the point at which a single income couple pay the higher rate and a dual income couple does. [44669/18]

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Peter Burke

Question:

168. Deputy Peter Burke asked the Minister for Finance the estimated cost of equalising the earned income tax credit with the PAYE tax credit in equal increments in budget 2020 and budget 2021. [44670/18]

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Peter Burke

Question:

169. Deputy Peter Burke asked the Minister for Finance the estimated cost of equalising the home carer credit with the PAYE tax credit in equal increments in budget 2020 and budget 2021. [44671/18]

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Peter Burke

Question:

208. Deputy Peter Burke asked the Minister for Finance the estimated full-year cost of increasing the employee tax credit by amounts (details supplied). [45582/18]

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Peter Burke

Question:

209. Deputy Peter Burke asked the Minister for Finance the estimated full-year cost of increasing the employee tax credit in future budgets (details supplied). [45583/18]

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Peter Burke

Question:

210. Deputy Peter Burke asked the Minister for Finance the estimated full-year cost of increasing the employee tax credit by amounts in future budgets (details supplied). [45584/18]

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Written answers

I propose to take Questions Nos. 166 to 169, inclusive, and 208 to 210, inclusive, together.

I assume that when referring to the employee tax credit, the Deputy is referring to the Employee PAYE Tax Credit.

I am advised by Revenue that the estimated increases to the Standard Rate Cut Off points, Earned Income Tax credit, Employee PAYE Tax Credit and Home Carer Tax Credit are set out in tabular form on pages 6 and 7 of the Revenue Ready Reckoner, which is available at the link: https://www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf.

While some of the costs of the increases sought by the Deputy are not displayed in the Ready Reckoner, they can be estimated on a straight-line or pro-rata basis from the costs shown. These estimated costs are shown in the following tables.

Increase to Standard Rate Cut-Off Point +€2,400

Standard Rate Cut Off Point Budget 2020

First Year Cost €m

Full Year Cost €m

Single Earner

€37,700

172.8

200

Married Couple One Earner

€46,700

60.8

73.6

Married Couple Two Earners

€75,400

185.6

216

Increase to Standard Rate Cut-Off Point +€2,000

Standard Rate Cut Off Point Budget 2020

First Year Cost €m

Full Year Cost €m

Single Earner

€37,300

144

166.7

Married Couple One Earner

€46,300

50.7

61.3

Married Couple Two Earners

€74,600

154.7

180

Earned Income Credit Budget 2020

First Year Cost €m

Full Year Cost €m

Increase to Earned Income Tax Credit +€150

€1,500

20

36

Home Carer Tax Credit Budget 2020

First Year Cost €m

Full Year Cost €m

Increase to Home Carer Tax Credit +€75

€1,575

5.3

6

Employee PAYE Tax Credit Budget 2020

Full Year Cost €m

Increase to PAYE Employee Tax Credit +€50

€1,700

103

Increase to PAYE Employee Tax Credit +€100

€1,750

206

Increase to PAYE Employee Tax Credit

Employee PAYE Tax Credit

Full Year Cost €m

+€50

€1,700

103

+€100

€1,750

206

+€150

€1,800

309

+€200

€1,850

412

+€250

€1,900

515

+€300

€1,950

618

+€350

€2,000

721

+€400

€2,050

824

+€450

€2,100

927

+€500

€2,150

1,030

+€550

€2,200

1,133

These estimates have been generated by reference to 2019 incomes, calculated on the basis of actual data for 2016, the latest year for which returns are available, and adjusted for income, self-employment and employment trends in the interim. The figures are however provisional and may be revised.

I am advised by Revenue that it is not possible to provide costings beyond Budget 2020 because the model used by Revenue does not have the ability to estimate beyond one static set level of growth (i.e. macros, elasticities etc.) using 2016 tax returns (the latest returns that are available). Revenue can only generate estimates for one year and not multiple steps over multiple years.

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