Dáil Éireann - Volume 469 - 03 October, 1996

Written Answers. - Farmers' Income.

26. Mr. Gregory asked the Minister for Finance, further to his reply to Parliamentary Question No. 70 of 25 July 1996, if the figure of taxable income of full-time farmers for 1992/93 of £347 million and the corresponding taxable income of trader farmers of £138 million can be reconciled with the estimated income from self-employment and other trading income in agriculture of £1,816.1 million in 1992 and £1,857.8 million in 1993 as per the Irish Statistical Bulletin in September 1995, page 487. [17581/96]

Minister for Finance (Mr. Quinn): Taxable income is that part of income on which tax is actually calculated. In arriving at a figure for taxable income deductions from gross income must be made, in accordance with the Income Tax Acts, in respect of expenses, capital allowances, stock relief, interest repayments on borrowings, contributions towards medical assurance, retirement annuities and basic personal allowances, or exemption limits, as appropriate.

The figures for the taxable income of farmers on Revenue records for 1992/93, namely £347 million for full-time farmers and £138 million for trader-farmers, correspond with gross income figures of £590 million for full-time farmers and £200 million for trader-farmers. The figure of £200 million attributed to trader-farmers includes income from trades or professions other than farming which is not distinguished in the total. Employment income of £275 million earned by farmers or their spouses and which is liable to tax under PAYE is also excluded from the figures of gross income attributed to both full-time farmers and trader-farmers.

These Revenue figures relate to a total number of 77,200 farmers, that is, 61,500 full-time and 15,700 trader-farmers, who were formally assessed to tax [1366] on their income tax returns for the income tax year 1992/93. Many of those assessments were for zero tax amounts.

The remaining farmers on tax records are not formally assessed to tax annually because their incomes are clearly too low to attract a tax liability. Details of the incomes of these individuals are not available.

A precise reconciliation between the income figures of farmers emerging from Revenue records and the figures included by the CSO in the Statistical Bulletin is not possible because each set is compiled independently of the other. Some of the main differences between the two sets of income figures are as follows:

— the CSO figures are inclusive of the amounts of interest payable on borrowed capital, while the Revenue figures exclude this factor;

— the CSO figures include all subsidies payable to the farming sector, whereas the Revenue figures include this factor only where the subsidy is an income subsidy and regarded as income for tax purposes, and then only for the cases who are formally assessed to tax on an annual basis;

— the CSO figures are based on their estimate of the income arising in the overall agricultural sector as against the Revenue figures which are limited to the individuals who are formally assessed annually;

— the CSO figures include the income from agricultural production of agricultural contractors, co-operatives, institutions and commercial concerns, which are excluded from the Revenue figures.