Dáil Éireann Debate, Wednesday - 28 April 2021
272. Deputy Catherine Murphy asked the Minister for Finance the estimated cost to the Exchequer if the entry point to the higher rate of income tax was increased to €42,500 for a single person and €85,000 for couples who are both working and equivalent change for taxpayer units with one partner in work. [21415/21]
View answerI am advised by Revenue that on their website they provide a Ready Reckoner which shows a wide range of detailed information in relation to potential tax changes. The Ready Reckoner shows projected Exchequer costs and yields of potential tax changes, including on page 6, estimated increases to the Standard Rate Cut Off points for income tax in tabular form. The Revenue Ready Reckoner is available at https://www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf.
Where the cost of specific increases proposed are not displayed in the Ready Reckoner, they can be estimated on a straight-line or pro-rata basis from the costs shown.
For example, the estimated cost of increasing the Standard Rate Cut Off point by €1,000 is as follows:
|
Category |
First Year Estimated Cost |
Full Year Estimated Cost |
|
Single / Widowed or Surviving Civil Partner |
€75 million |
€85 million |
|
Married / Civil Partner (both with income) |
€71 million |
€81 million |
|
Married / Civil Partner (with one income) |
€26 million |
€30 million |
|
Total Cost |
€171 million |
€197 million |
Therefore, the estimated cost of the increase specified in the Deputy's question, if undertaken in a single year, would be approximately €1.2 billion in respect of the first year of the increase and about €1.4 billion in a full year.
