450 Mr. G. Reynolds asked the Minister for Finance the reason self-employed and professional families can avoid paying tax at the higher rate until they have earnings up to 67,200, while the limit for single income PAYE families is 34,800; and the number of families disadvantaged by this policy decision. [2688/02]

451 Mr. G. Reynolds asked the Minister for Finance the reason self-employed and professional families will pay 7,200 less in tax on their stated income than the PAYE family; and his views on the tax individualisation scheme. [2689/02]

I propose to take Questions Nos. 450 and 451 together.

452 Mr. J. Mitchell asked the Minister for Finance the tax exemption limits for widows and elderly persons; his plans to augment or improve these exemption limits; and if he will make a statement on the matter. [2717/02]

In budget 2002, I increased the income tax exemption limits for those aged 65 and over by over 20% to 13,000 for single and widowed persons and to 26,000 for married persons. In addition to the above exemption limits, I point out that in the year of bereavement, a widowed person may receive a personal tax credit which is equivalent in value to the married tax credit. In budget 2002, I increased the value of this credit from 2,794 to 3,040. Following the year of bereavement, a widowed parent with a qualifying child or children may qualify for the one-parent family tax credit of 1,520 in addition to the single personal tax credit of 1,520.

A further credit, the widowed parent credit, is available on a sliding scale for the first five tax years following the year of bereavement. In budget 2002, I also increased these credits significantly to the following: