Dáil Éireann Debate, Tuesday - 6 October 2009
837 Deputy Joan Burton asked the Minister for Social and Family Affairs the amount of tax revenue which would be raised on a 2010 and full year basis by abolishing the employee PRSI ceiling in view of the relevant recommendation set out in the Commission on Taxation report 2009. [33767/09]
Amharc ar fhreagra843 Deputy Arthur Morgan asked the Minister for Social and Family Affairs the amount that would be raised by abolishing the ceiling on PRSI. [34434/09]
Amharc ar fhreagraI propose to take Questions Nos. 837 and 843 together.
Current estimates indicate that the abolition of the PRSI ceiling would yield some €119.5 million additional contribution income in a full year.
Under the PRSI system, social insurance contributions are compulsorily payable by employers and employed and self-employed workers. In relation to employee's contributions, the amount payable is determined by reference to reckonable earnings in a weekly period, and is subject to a range of thresholds and an annual ceiling. The PRSI exemption on low earnings stands at €352 per week. People with incomes at that level or below are exempt from PRSI. Once a person earns above this level their total income, up to the annual ceiling, is chargeable to PRSI but they are entitled to a PRSI-Free Allowance of €127 per week.
The employee PRSI ceiling is reviewed annually in accordance with the legislative stipulations of the Social Welfare (Consolidation) Act, 2005 and is currently €75,036. Any future changes to the PRSI ceiling would have to be considered in a budgetary context.
838 Deputy Joan Burton asked the Minister for Social and Family Affairs the amount of tax revenue which would be raised on a 2010 and full year basis by subjecting employees’ unearned income, such as investment income and rental income, to PRSI in view of the relevant recommendation set out in the Commission on Taxation report 2009. [33768/09]
Amharc ar fhreagra839 Deputy Joan Burton asked the Minister for Social and Family Affairs the amount of tax revenue which would be raised on a 2010 and full year basis by subjecting share-based remuneration, including share options, to PRSI in view of the relevant recommendation set out in the Commission on Taxation report 2009. [33769/09]
Amharc ar fhreagraI propose to take Questions Nos. 838 and 839 together.
Pay related social insurance is not a tax. Therefore additional revenue raised from any change to the PRSI system goes directly to the social insurance fund rather than the Exchequer.
The payment of PRSI primarily relates to income derived from reckonable earnings from employment or self-employment. The Commission on Taxation has recommended a further widening of the PRSI base so that both unearned income such as investment income and rental income and share-based remuneration should be subject to PRSI.
In regard to unearned income at present, self-employed contributors pay PRSI on rental income. In addition while employed contributors are not generally subject to PRSI on investment income and rental income there is a liability where the individual concerned also has trade, professional or partnership income in which case they are chargeable to PRSI as a self employed contributor on rental income. Therefore, a significant amount of rental income is already subject to PRSI.
Share based remuneration is currently not included in the PRSI base as it is not considered as reckonable earnings, reckonable emoluments or reckonable income under the Social Welfare Consolidation Act 2005.
It is not possible therefore, to estimate of the potential yield for rental income and share based remuneration which is currently not subject to PRSI.
