Gay Mitchell
Ceist:46 Mr. G. Mitchell asked the Minister for Finance the cost of removing the minimum wage entirely from the scope of income taxes in 2005. [24613/04]
Amharc ar fhreagraThursday, 14 October 2004
Ceisteanna (50, 51)
Freagraí scríofa
The statutory minimum wage is €7 per hour and is equivalent to an annualised figure of €14,196.
I am informed by the Revenue Commissioners that the full year costs to the Exchequer of ensuring no tax is paid by a single employee earning this amount would be €350 million in a full year, if done through an increase in the employee PAYE credit. It would be €525 million in a full year if the personal credit were used. If the required increase was divided between the personal and employee credits then the full year cost would be €440 million. A married one earner on €14,196 would not be liable to tax given the current level of credits. These figures are estimated by reference to projected 2005 incomes. They are also provisional and are likely to be revised.
The mid-term review of part two of Sustaining Progress — Pay and the Workplace — was published last June. It contained an agreement that the Labour Court will review the national minimum wage and make a recommendation to apply with effect from 1 May 2005, in accordance with the National Minimum Wage Act 2000.
John Gormley
Ceist:47 Mr. Gormley asked the Minister for Finance if persons on early retirement pensions, with voluntary salary protection, are not entitled to participate in PRSA schemes, and avail of subsequent tax relief. [24812/04]
Amharc ar fhreagraRelief from income tax is available for contributions to a personal retirement savings account by an individual with earnings from any trade, profession or employment. The same rule applies to other pension products. A pension is drawn down in retirement to replace earnings made before retirement. A person on an early retirement pension is thus already retired and the facility to gain tax relief on pension contributions from that income is not available. If the person has separate earnings from other employment or self employment, they would be entitled to contribute to a pension from these earnings and claim tax relief on the contributions up to age 70 or 75 depending on the product.
Question No. 48 answered with QuestionNo. 37.