Significant personal tax reductions have been made over the last three budgets. The cumulative full year cost of the personal tax reductions introduced, including income tax, levies and employees' PRSI, in the three budgets amounts to close to £750 million even after allowing for the phased standardrating of reliefs for mortgage interest and medical insurance premiums which was introduced in the 1994 budget.
The last three budgets combined have seen the basic personal allowances increased by £550 single/£1,100 married, or by almost 23.5 per cent; the general exemption limits increased by £400 single/£800 married and those for the aged increased by £500 single/£1,000 married, or by around 11 per cent; the standard tax band widened by £1,700 single/£3,400 married, or by over 20 per cent and the income level at which the top rate of tax is payable rise by around 17 per cent in the case of a single PAYE worker and by 19 per cent in the case of a married couple, one earner, over this period.
These increases compare very favourably with the estimated CPI increase of around 6.5 per cent over the same period.