Vol. 540 No. 1
231 Mr. R. Bruton asked the Minister for Finance the cost of exempting from income tax the earnings of a single person on the proposed new basic minimum wage, and the difference in cost of raising the tax credit to that level compared to other methods of exempting small earners from tax. [19551/01]
I am informed by the Revenue Commissioners that the full year costs to the Exchequer, estimated by reference to 2001 incomes, of the change mentioned by the Deputy are as follows:
If the personal tax credits for single and widowed persons were increased so that the combined total value of the single and PAYE credits was equal to the level of the minimum wage, based on earnings of £4.70 per hour over an assumed standard 39 hour week and with a pro rata increase of double that amount for married persons, the cost would be of the order of £593.5 million.
If the PAYE credit alone was increased to this level, the cost would be in the region of £405.1 million; this is less costly as self-employed persons and their spouses are not entitled to avail of this allowance and, in addition, the allowance is not doubled for a married couple with one person earning.
