Summary of measures on personal taxation
Published on: 22 January 2020
Click here to download the full personal taxation policy document
If elected to government, Fianna Fáil will:
- Reduce the 4.5% Universal Social Charge to 3.5%;
- Increase the Standard Rate Income Tax Band by €3,000 for an individual and €6,000 for a couple;
- Fully equalise the self-employed with PAYE workers by increasing the Earned Income Tax Credit to €1,650;
- Assist home carers by increasing the Home Carer’s Tax Credit to €2,000;
- Increase the income Tax Exemption limits for the over 65s by €500 for a single person and €1,000 for married couples;
- Help renters by introducing a €600 Rental Tax Credit;
- Help parents using a registered childminder with a €2,000 Childminder Credit.
Here are a few practical examples of our measures:
A single person earning €40,000 and renting:
Under Fianna Fáil’s personal tax measures this person will:
- Have nearly €1,400 a year more in their pockets which equates to roughly €116 a month;
- Reduce the tax paid from €8,348 to €6,953;
- Reduce the person’s effective tax rate from 21% to 17%;
A single person earning €50,000:
Under Fianna Fáil’s personal tax measures this person will:
- Have nearly €900 a year more in their pockets which equates to roughly €75 a month;
- Reduce the tax paid from €13,198 to €12,303;
- Reduce the person’s effective tax rate from 26% to 25%;
One income family earning €40,000 and renting:
Under Fianna Fáil’s personal tax measures this person will:
- Have nearly €1,200 a year more in their pockets which equates to roughly €100 a month;
- Reduce the tax paid from €4,158 to €2,963;
- Reduce the person’s effective tax rate from 10% to 7%;
One income family earning €50,000:
Under Fianna Fáil’s personal tax measures this person will:
- Have nearly €1,300 a year more in their pockets which equates to roughly €108 a month;
- Reduce the tax paid from €8,148 to €6,853;
- Reduce the person’s effective tax rate from 16% to 14%;
Single self-employed person earning €40,000 and renting:
Under Fianna Fáil’s personal tax measures this person will:
- Have over €1,500 a year more in their pockets which equates to roughly €129 a month;
- Reduce the tax paid from €8,498 to €6,953;
- Reduce the person’s effective tax rate from 21% to 17%;
Single self-employed person earning €50,000:
Under Fianna Fáil’s personal tax measures this person will:
- Have around €1,045 a year more in their pockets which equates to roughly €87 a month;
- Reduce the tax paid from €13,348 to €12,303;
- Reduce the person’s effective tax rate from 27% to 25%;
One income self-employed family earning €40,000 and renting:
Under Fianna Fáil’s personal tax measures this person will:
- Have around €1,345 a year more in their pockets which equates to roughly €112 a month;
- Reduce the tax paid from €4,308 to €2,963;
- Reduce the person’s effective tax rate from 11% to 7%;
One income self-employed family earning €50,000:
Under Fianna Fáil’s personal tax measures this person will:
- Have around €1,445 a year more in their pockets which equates to roughly €120 a month;
- Reduce the tax paid from €8,298 to €6,853;
- Reduce the person’s effective tax rate from 17% to 14%;
Separately Fianna Fáil is announcing an expansion of the Rainy Day Fund .
– Expansion of the Rainy Day Fund is the prudent and responsible thing to do-
Fianna Fáil will:
- Invest a further €250 million a year into the Rainy Day Fund bringing the total annual contributions to €750 million.
- This, along with the €1.5 billion invested from the Ireland Strategic Investment Fund, will bring the total amount in the Rainy Day Fund to €5.25 billion in 2025
- This will be in addition to running a surplus in the general government balance every year.
Commission on Taxation
Fianna Fáil is also proposing the establishment of a new Commission on Taxation to examine the overall sustainability of our tax system.
The last Commission on Taxation reported in 2009, so it is now timely to examine a number of key issues.
The Commission will examine, for example,:
- The future of the Universal Social Charge;
- The taxation impact of moving to a low carbon economy;
- The sustainability of corporation tax receipts in the context of global tax reform;
- The taxation environment for indigenous firms;
- The taxation of property funds.