Minister’s Brief

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3.1.3.2 General income tax policy and reform Principal Officer: Seamus Milne Gary Tobin Assistant Secretary Tax Division Seamus Milne Principal Officer Income Tax Policy Deirdre Donaghy Assistant Principal Income Tax Policy Denise O'Connell Assistant Principal Income Tax Policy - Certain Incentive Schemes Key Points: Income taxes make up over 40% of all tax revenues projected for 2016. Of the projected Income tax receipts of €19 billion, income tax is expected to yield €14 billion, USC to yield €4 billion and taxes on savings and investments, €1 billion. Given its significance in revenue raising, changes to the USC would likely require the introduction of other discretionary revenue raising measures to fund it. Following recent Budgets almost 30% of income earners are already exempt from USC, up from 25% in 2013. This compares with almost 36% who are exempt from Income Tax. Employees on incomes below €70,000 are liable to a maximum marginal tax rate of 49.5% comprising of Income Tax, USC and PRSI. Employees on incomes above €70,000 remain liable to a maximum marginal tax rate of 52%. Self-assessed individuals with incomes greater than €100,000 are liable to a marginal tax rate of 55% on that income. Page 32 of 184
Detail: Income Tax Policy Income Taxes Tax Head 2007 (€m) 2013 (€m) 2014 (€m) 2015 (€m) 2016(e)(€m) Income Tax 13,572 11,835 13,517 14,175 15,000 USC n/a 3,925 3,647 4,175 3,995 PRSI 7,100 7,140 7,714 8,313 8,489 Revenues Income taxes (including USC) make up the largest share by tax head of Exchequer tax revenues. Receipts of just under €19 billion are forecast for 2016, over 40% of total tax revenues. Of this, Income Tax is expected to comprise c.€14 billion, USC c.€4 billion, and withholding taxes on savings and investment income c.€1 billion. Distribution of Income Earners The projected distribution of income earners in 2016 is as follows: Income Tax 2016 Distribution of Income Earners Universal Social Charge 2016 Distribution of Income Earners 3% Schg 8% Rate Exempt Higher Rate Exempt Standard Rate 3% Rate 5.5% Rate Income Tax Earners % of Earners USC Earners % of Earners Higher Rate 474,155 19.7% 3% Schg 32,732 1.4% Standard Rate 1,068,487 44.4% 8% 168,193 7.0% Exempt 862,295 35.9% 5.5% 1,052,601 43.8% Total 2,404,937 3% 447,595 18.6% Exempt 703,816 29.3% Total 2,404,937 Page 33 of 184
Page 1 and 2: Minister’s Brief 2016 s Page 1 of
Page 3 and 4: 3.2.1.1 Policies on Mortgage Arrear
Page 5 and 6: 1. Introduction For the purposes of
Page 7 and 8: 2.1 Economic and Fiscal Directorate
Page 9 and 10: 2.2 Finance and Banking Directorate
Page 11 and 12: 3. Detailed Briefing Page 11 of 184
Page 13 and 14: 3.1.2 Economic Division Description
Page 15 and 16: Detail: Economic Outlook Pr
Page 17 and 18: 3.1.2.2 Microeconomic analysis unde
Page 19 and 20: changes in the relevant tax base) a
Page 21 and 22: 3.1.2.3 Economic coordination inclu
Page 23 and 24: 3.1.2.4 Budgetary/fiscal policy, go
Page 25 and 26: Assessment of compliance with SGP o
Page 27 and 28: was a deviation from the fiscal rul
Page 29 and 30: tax, followed by personal income ta
Page 31: Tax Strategy Group - What Does It D
Page 35 and 36: Credit in 2014 - that credit was of
Page 37 and 38: INCOME TAX INCENTIVES Agri-Taxation
Page 39 and 40: Marine taxation In Budget 2016, a r
Page 41 and 42: Detail: Indirect Tax Policy Tax Hea
Page 43 and 44: outcomes, then it was proportionate
Page 45 and 46: More fundamental threats to tobacco
Page 47 and 48: 3.1.3.4 Finance Bill co-ordination,
Page 49 and 50: ise in both equity markets and prop
Page 51 and 52: Tax Head 2007 (€m) 2013 (€m) 20
Page 53 and 54: 3.1.3.5 International taxations, co
Page 56 and 57: fully in line with the new OECD req
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Page 60 and 61: At EU level, the Governance section
Page 62 and 63: 3.1.5.2 EU-IMF Post Programme Monit
Page 64 and 65: 2. EU Funding Mechanisms/ Programme
Page 66 and 67: Detail: The EU Strategy Unit manage
Page 68 and 69: 3.1.5.4 International Relations Uni
Page 70 and 71: 3.1.5.5 Permanent Representation of
Page 72 and 73: 3.2 Finance and Banking Directorate
Page 74 and 75: 3.2.1.1 Policies on Mortgage Arrear
Page 76 and 77: available is €1.8 million. Initia
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Page 81: deemed necessary, it may be prefera
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Detail: Key Initiatives to achieve
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5. Majority of credit requests cont
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3.2.2 Financial Services Division D
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A further group is reviewing the re
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financing would be available to cov
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o Cumulative impact of financial le
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3.2.2.2 National and EU policy and
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Securities The draft EU Prospectus
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In addition a full view of the fina
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"packaging", wrapping or bundling t
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3.2.3 Shareholding Management Unit
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3.2.3.1 State’s Banking Investmen
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3.2.3.2 State’s shareholding in A
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sheet continues to contract, albeit
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3.2.3.4 NAMA Specialist - Declan Re
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Detail: NAMA Background As part of
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3.2.3.5 IBRC (in special liquidatio
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In February 2013 the Irish Bank Res
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3.2.3.6 State’s shareholding in P
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PTSB’s return to profitability ha
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Credit Union Restructuring Board (R
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3.2.3.8 Management of all legal mat
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3.2.4.1 Risk and Financial Stabilit
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• development and maintenance of
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epresented and an Industry Advisory
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3.2.4.1 Management of FoI and PQ pr
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3.2.4.1 Liaison with the Attorney G
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3.2.4.2 Management of the Accountan
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Future Developments The vote accoun
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3.2.5 International Financial Insti
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Key Points: International Monetary
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with the delegation led by Second S
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assistance to the developing world.
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In addition to capital contribution
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would be the Minister for Finance o
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3.3 Corporate Page 165 of 184
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supported by OPW and a number of ex
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3.3.2. Corporate Affairs Descriptio
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member, the Department has a Busine
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ability of both electronic files an
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3.3.3. Human Resources Division Des
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Detail: 1. Organisational Structure
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effectively to improve and deliver
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The Department is currently reviewi
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Erosion of income tax base did not
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Minister’s Brief

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