Tuesday, 29 September 2020

Ceisteanna (43)

Gerald Nash

Ceist:

43. Deputy Ged Nash asked the Minister for Finance his views on a recent Central Bank report on household wealth; his views on the growth in the net wealth of the top 20% of households from €560,000 to €853,000; and if he will consider adjusting taxation measures to increase revenue from the top 10% quintile of households to help fund the Covid-19 recovery. [26798/20]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Finance)

I understand that the Deputy is referring to the recently published Central Bank report “Household Wealth: What is it, who has it, and why it matters”.

This report presents the results from the Household Finance and Consumption Survey (HFCS) 2018, which collects data on households’ financial positions. That survey was undertaken prior to the outbreak of COVID-19, but in time will provide a starting point against which to benchmark impact of the pandemic on household finance positions and consumption patterns. It reports that the survey data indicates an improved financial position and resilience for households prior to the COVID-19 crisis when compared to the situation leading into 2008.

I am informed that the HCFS indicates that household net wealth grew by over €76,000 for the median household, or by 74 per cent, to €179,200 from 2013 to 2018, driven primarily by house price growth and declining mortgage debt. The Central Bank report also highlights that a significant portion of wealth for most households was tied up in the family home, and that increases in house prices (74% increase for the period) was a major factor in the reported increase in household wealth.  This net wealth grew across the entire wealth distribution, while inequality, as measured by the Gini coefficient, fell over the same period. The decline in negative equity from 33 per cent in 2013 to 4 per cent in 2018 was a key driver of this.

Whilst the net wealth of the top 20 per cent of households increased by approximately 52 per cent from €560,000 to €853,000, the relative share of net wealth held by the top 10 per cent of households - which stood at 50.4 per cent in 2018 - decreased by 2.6 per cent from 2013, and is 1.3 per cent lower than the equivalent figure for the Eurozone as a whole.

My officials continue to examine all issues related to taxation, including wealth taxation, on an on-going basis, and they and I will monitor and consider any additional information and data, such as that in the new report, that comes to light. I do not, however, have any plans to introduce wealth tax measures along the lines of those sought by the Deputy.”

Question No. 44 answered orally.