Tax Yield

Dáil Éireann Debate, Tuesday - 15 July 2014

Tuesday, 15 July 2014

Ceisteanna (212, 213, 214)

Pearse Doherty

Ceist:

212. Deputy Pearse Doherty asked the Minister for Finance to set out the partial and full year revenue that would be raised for the Exchequer by increasing capital acquisitions tax to 40%. [31231/14]

Pearse Doherty

Ceist:

213. Deputy Pearse Doherty asked the Minister for Finance to set out the partial and full year revenue that would be raised for the Exchequer by increasing capital acquisitions tax to 40% and reduce the group thresholds by 10%, 15% and 20%, respectively. [31232/14]

Pearse Doherty

Ceist:

214. Deputy Pearse Doherty asked the Minister for Finance to set out the partial and full year revenue that would be raised for the Exchequer by reducing the group thresholds for capital acquisitions tax by 10%, 15% and 20%, respectively. [31233/14]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 212 to 214, inclusive, together.

I am advised by the Revenue Commissioners that the estimated full year yield to the Exchequer from increasing the Capital Acquisitions Tax (CAT) rate from 33% to 40%, based on the expected outturn in 2014, could be in the region of €77 million, assuming no change in the existing thresholds.

The estimated full year yield from existing taxpayers from applying the proposed CAT rate of 40% and reducing thresholds by 10% is €100 million, from applying the proposed CAT rate of 40% and reducing thresholds by 15% is €112 million, and from applying the proposed CAT rate of 40% and reducing thresholds by 20% is €124 million.

The estimated full year yields, while maintaining the CAT rate at 33%, from existing taxpayers of reducing CAT thresholds by 10%, 15% and 20% is €19 million, €29 million and €38 million respectively.

I am advised that CAT returns are not required to be filed with the Revenue Commissioners where gifts and inheritances do not exceed 80% of the current threshold limits. For this reason, the estimates shown above do not include any additional yield associated with benefits brought into the tax net due to reduced threshold limits.

Partial year yields are not shown as they would depend on the date of introduction of the proposals.  All estimates are provisional and subject to revision.

It should be noted that these estimates are based upon an assumption that there would be no behavioural impact of these changes, which could lead to differing Exchequer yield impacts.  In addition, the realisation of any yield on assets relating to property is subject to movements in the value of such assets.