New figures from the Revenue Commissioners show that 72 people with incomes above €125,000 would have paid no income tax at all last year were it not for measures designed to curb the use of tax reliefs by high earners.
Revenue’s Analysis of High-Income Individuals’ Restriction 2023 reports that 127 taxpayers were subject to the restriction in 2023, generating an additional €13.58 million for the exchequer.
Fourteen of those had earnings in excess of €1 million and collectively paid an extra €6.3 million as a result of the rules limiting reliefs.
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Of the 72 people who would otherwise have had no income tax liability, 27 had adjusted incomes of €400,000 or more, while 45 had incomes between €125,000 and €400,000.
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The €13.58 million raised in 2023 represents a decline from the €17.27 million collected from 153 high-income taxpayers in 2022. It remains far below the peak recorded in 2010, when €80.18 million in additional tax was raised from 1,544 individuals.
Over the five-year period from 2019 to 2023, the restriction has generated €90.87 million in extra income tax.
[ Company directors and landlords dominate latest tax defaulters’ listOpens in new window ]
The report states that the long‑standing policy objective – ensuring an effective income tax rate of about 30 per cent for those with adjusted incomes above €400,000 – was achieved last year.
Before the restriction was applied, the 14 taxpayers earning more than €1 million had a combined income tax bill of €2.2 million, reflecting an effective rate of 14.3 per cent. After the limit on reliefs was imposed, their collective liability rose to €8.5 million, or an effective rate of 29.7 per cent.
When the universal social charge is included, the cohort faced a total tax take of €11.2 million in 2023, equating to an average effective rate of 39.1 per cent.
