Dáil Éireann díospóireacht -
Wednesday, 14 Jun 2000

Vol. 521 No. 2

Written Answers. - Social Insurance.

Joe Higgins

Ceist:

138 Mr. Higgins (Dublin West) asked the Minister for Social, Community and Family Affairs the revenue or estimated revenue accruing to the social insurance fund through abolishing the income contribution ceiling for employees' PRSI; employers' PRSI; and self-employed PRSI. [16868/00]

Joe Higgins

Ceist:

139 Mr. Higgins (Dublin West) asked the Minister for Social, Community and Family Affairs the revenue or estimated revenue accruing to the social insurance fund by applying the employees' PRSI contribution levy to gross capital gains; net capital gains; gross capital acquisitions; and net capital acquisitions. [16869/00]

Joe Higgins

Ceist:

140 Mr. Higgins (Dublin West) asked the Minister for Social, Community and Family Affairs the revenue or estimated revenue accruing to the social insurance fund by applying the employees' PRSI contribution levy to benefit-in-kind. [16870/00]

Minister for Social, Community and Family Affairs (Mr. D. Ahern)

I propose to take Questions Nos. 138, 139 and 140 together.

The estimated yield to the social insurance fund of abolishing the employee, employer and self-employed annual earnings ceiling is £85 million, £102 million and £150 million, respectively. Currently, PRSI does not apply to the value of gross or net capital gains, gross or net capital acquisitions or benefits in kind.

On the basis of the current estimated outturn of net capital gains tax in 2000, it is estimated that the yield to the social insurance fund would be of the order of £99 million if PRSI was applied at the main employee rate – 4.5% – on the corresponding amount of net gains, that is, after the subtraction of the appropriate reductions and reliefs. These gains include gains on the disposal of assets by individuals as well as gains arising from the disposal of development land by companies which are not distinguishable in the overall figures. As statistics are not available which would enable an estimate of the value of those gains prior to the netting off of deductions and reliefs, it is not possible to arrive at an estimate of the yield to the social insurance fund if employee PRSI was applied to gross capital gains.

On the basis of the current estimated outturn of net capital acquisitions tax in 2000, it is estimated that the yield to the social insurance fund would be of the order of £59 million if PRSI was applied at the main employee rate – 4.5% – on the corresponding amount of net acquisitions, that is after the subtraction of the appropriate reductions and reliefs. As statistics are not avail able which would enable an estimate of the value of these acquisitions prior to the netting off of deductions and reliefs, it is not possible to arrive at an estimate of the yield to the social insurance fund if employee PRSI was applied to gross capital acquisitions.

Based on the total amount of income identified for income tax purposes as benefit in kind in 1997-8, the latest year for which statistics are available, it is estimated that the yield to the social insurance fund would be £10 million if PRSI was applied at the main employee PRSI rate. The estimated yields outlined above in relation to capital gains, capital acquisitions and benefits in kind would only be realised in the event of the present annual employee and self employed PRSI ceiling being abolished. In the absence of such a move, the actual yield from applying PRSI to these items would be significantly lower as persons with incomes above the current ceilings are more likely to be in receipt of these sources of income.