Saturday 24 March 2018

Burton dodges questions over child benefit tax

Michael Brennan and Lise Hand

SOCIAL Protection Minister Joan Burton last night refused to reveal how much money would be brought in if the Government taxed child benefit for parents earning over €100,000.

And she was also unable to say how much it would cost to implement or whether such a change would result in any actual cash savings.

Last night, a series of questions remained unanswered about her proposal to tax high-earning parents including:

• How many of the 113,500 people earning over €100,000 are actually receiving child benefit payments?

• Are the Revenue and Social Protection computer systems still unable to share information that would identify which high earners are receiving the monthly payment?

• What recommendations were made by the inter-departmental group in the final report delivered almost three months ago?

• Will she publish the report and its findings?

Under Ms Burton's plan, parents would only pay tax on their child benefit if one of them was earning over €100,000 -- their combined salaries would not be taken into account.

This would lead to a farcical situation where a family with one earning parent on a salary of just over €100,000 would be taxed -- but if two parents were earning €99,000 each, they wouldn't be taxed.

Last night, the Department of Finance refused to comment on what it said was a "budgetary matter". The Revenue also declined to comment.

Intensive technical work would be required for the plan to tax the monthly €140 payment for people earning over €100,000.

Her department has the names of the parents of the 1.1 million children who are getting child benefit -- but only the Revenue has the details of how much they are earning.


There are around 113,500 people earning more than €100,000 but it is not known how many of them are receiving child benefit payments.

A spokesman said Ms Burton was simply stating her own "personal preference" for taxing child benefit rather than means testing it -- and that no cabinet discussions about introducing it in the Budget had taken place.

But her department could not provide any figures for how much the tax would bring in or how much it would cost to implement.

Ms Burton did not get public backing yesterday from Tanaiste Eamon Gilmore, who refused to be drawn on the issue.

"What we may or may not do about it is a matter that will have to await budgetary decisions and we're not making those decisions in this part of the year," he said.

Fianna Fail leader Micheal Martin said that while no one would quibble with taxing child benefit for those earning €100,000, it would not have a "very significant impact".

"It does suggest gesture politics," he told RTE's 'This Week'.

Previous governments have failed to tax child benefit, due to the technical difficulties.

The late Finance Minister Brian Lenihan promised that child benefit would be means-tested or taxed in his 2011 Budget. But it proved too difficult to implement and he had to impose a flat-rate cut instead.

A repeat of the 10pc child benefit cut he introduced would bring the payment down by a further €14 to €124 and reduce the annual bill by €190m.

During last year's general election campaign, Fine Gael budgeted for a cut in child benefit in its policies. But a direct cut would be politically difficult for Ms Burton and her Labour Party, which promised voters that it would prevent Fine Gael from doing this.

Irish Independent

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