Catherine Murphy
Question:237. Deputy Catherine Murphy asked the Minister for Finance the estimated full year yield from each 1.5% increase in the minimum effective tax rate of persons earning over €150,000 per year. [1182/21]
View answerWednesday, 13 January 2021
Questions (237)
Written answers
The High Income Individuals' Restriction (HIIR), provided for in Section 485C of the Taxes Consolidation Act 1997, limits the use of specified reliefs in calculating a taxpayer’s taxable income. The Restriction is designed to ensure an effective rate of 30% where a taxpayer has income of €400,000 or more (adjusted in accordance with the provisions of the Section). The Restriction begins to apply when income is greater than €125,000 and the total of specified reliefs exceeds €80,000.
I am advised by Revenue that taxpayers who were subject to the HIIR in 2018, the latest year for which data are available, with an adjusted income of €400,000 or more, had an effective tax rate (excluding USC) of 29.9%.
Regarding the Deputy’s Question, I am advised by Revenue that taxpayers who were subject to the HIIR on incomes between €150,000 and €400,000 in 2018 had an effective tax rate (excluding USC) of 23%. A 1.5% increase in this effective rate would yield an estimated €0.8m per year.
I am further advised by Revenue that statistics on the operation of the HIIR are published at link: https://www.revenue.ie/en/corporate/information-about-revenue/research/statistical-reports/high-income-earners-reports.aspx , which may be of interest to the Deputy.
Question No. 238 answered with Question No. 218.