Dáil Éireann díospóireacht -
Tuesday, 19 Feb 1991

Vol. 405 No. 3

Written Answers. - Income Tax Rates.

Toddy O'Sullivan

Ceist:

56 Mr. T. O'Sullivan asked the Minister for Finance the average weekly savings from income tax which would arise from the introduction of a 25 per cent standard rate of tax and a single top rate of income tax with current tax bands applying in 1991-92 to the following taxpayers: (a) £10,000 per annum (PAYE and PRSI allowance) single (b) £20,000 per annum (PAYE and PRSI allowance) single (c) £30,000 per annum (PAYE and PRSI allowance) single (d) £15,000 per annum (PAYE and PRSI allowance) married, spouse not working (e) £30,000 per annum (PAYE and PRSI allowance) married, spouse not working and (f) £60,000 per annum (PAYE and PRSI allowance) married, spouse not working; and if he will make a statement on the matter.

Minister for Finance (Mr. A. Reynolds)

Assuming the enactment of this year's budget proposals, the introduction of a 25 per cent standard rate, and the adoption of a single higher rate of tax of 48 per cent to replace the existing higher rates, the average weekly savings arising for the incomes referred to in the question are as set out in the following table:

Income as specified in the question.	Saving per week.	Saving as % of existing liability.
	£
(a)	5.15	13.4%
(b)	10.55	7.7%
(c)	18.23	7.7%
(d)	7.47	13.8%
(e)	14.24	7.8%
(f)	37.32	7.7%

Gerry O'Sullivan

Ceist:

57 Mr. G. O'Sullivan asked the Minister for Finance if he will outline the current EC Commission view on the introduction of a Community-wide deposit interest retention tax; and if he will make a statement on the matter and its implications for the renewal of DIRT tax in Ireland.

Minister for Finance (Mr. A. Reynolds)

The European Commission brought forward, in February 1989, a proposal for the introduction of an EC-wide minimum withholding tax of 15 per cent on interest income. This was strongly opposed by a number of member states and, although it has not been withdrawn formally by the Commission, it is not expected to find agreement.

Deposit interest retention tax (DIRT) relates to accounts of residents within the State, and I would point out that, under the EC Directive on liberalisation of capital movements, Ireland is not obliged to permit residents to open accounts abroad before end-1992.

I will be keeping the position on DIRT in the post-1992 situation under review in the interim, taking into account both future domestic taxation developments and the experience of other EC member states which retain analogous taxes while relaxing exchange controls.