Pension Levy of 0.15% to expire at end 2015

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Brendan Burgess

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The reduction in the VAT rate for tourism services to 9% was funded by the 0.6% Pension Levy I introduced in the Jobs Initiative in 2011 and continued in the Budget last year. Without the Pension Levy there would have been no VAT reduction. This is a fact. Not only would this have meant that the thousands of jobs that have been created in the sector may not have been created but that thousands of existing jobs could have been at risk.

As a result of the overall improvement in the country’s finances, I am now in a position to continue the VAT reduction but I am also ending the 0.6% Pension Levy at the end of 2014.

The additional 0.15% Pension Levy I introduced for 2014 and 2015 will expire at the end of 2015.
 
I for one will not forget the theft of my pension funds, no cause for celebration here, this was always wrong, he has some neck extending this into next year when he is on the record saying it would be abolished before now.

If you are on Pension, a deferred member of a pension scheme or a serving employee. ( private sector of course ) then you have had your pot dipped into and have a tangible loss now or deferred until you get to normal pension age.
 
Perhaps I'm a bit cynical but shouldn't we all be prepared for a feeling of deja vu?

In the past Noonan stated before that the levy in question would be scrapped but ended up not only extending it but also increased it with a very vague and cryptic attempt (in my opinion) to explain it away as a failure of the pensions industry.

It would be wise to keep this in mind especially since they're mindful of the next election given an increasing block of voters have made it clear they're fed up of FG + Labour.
 
Perhaps Mr Noonan will Refund the Pension Levy Deductions, when he restores the Public Sector to their pre. austerity salary rates. Of course the Public Sector had no reduction in their future pensions.

Encouraging younger people to take out pensions - what a laugh.
Browtal
 
It means that people in the private sector who have to fund their pension will no longer be robbed in order to pay for pensions in the public sector (who generally have much higher pension benefits) whose pensions are (largely) unfunded.
The private sector Pension Levy has taken over €2b out of the funds of employees and pensioners. But since public sector pensions are unfunded there was no Levy applicable to such employees.
 
I knew the public Sector would not understand.

Thanks to Conan for clarification Browtal
 


Yet when you ask how many jobs were created by robbing people's pension funds you are told that no records are kept. The money was put into the exchequer and spent, not ring fenced.

I'm with MysticX on this, let's wait and see if it is abolished next year. Noonan said it would be gone and he went and increased it.


Steven
www.bluewaterfp.ie
 
Did the 0.6% pension levy apply to Public Service pensions and the 0.75% apply to Private Sector pensions?
Does it mean that people in receipt of a Public Sector pension will not have to pay a levy in 2015?
 
Palerider said:
I for one will not forget the theft of my pension funds, no cause for celebration here, this was always wrong, he has some neck extending this into next year when he is on the record saying it would be abolished before now.
Click to expand...

+1 I won't forget this theft either and as MysticX said, we can't trust Noonan to keep his word at the end of 2015 either.
 
Frager,
The 0.6% levy plus the additional 0.15% Levy only ever applied to private sector funded pension schemes. Since the Public Sector pension arrangement is an unfunded scheme (there is no actual fund, pensions are paid out of Govt funds) the 0.75% total Levy did not apply (i.e. 0.75% of nothing is still nothing).
So in effect those employees in the private sector and self employed who made the sensible financial decision to actually save for their eventual retirement were punished, with the Govt taking over €2b over the last 4 years. This also affected pensioners in many private sector schemes, where the Trustees often reduced the pension payments to reflect the amount of the Levy being taken from the Fund.
 
Conan,
Thanks for your reply.
Unfortunately it leaves me with a question.
Under Deductions Sub Heading 'PUBLIC SERVICE PEN' I see the sum of 93.92.
This is 6.7% of my gross pension.
Do you have any idea what this might be?
 
Conan,

I have discovered the information re the deduction referred to.
The Public Service Pension Reduction (PSPR)
This reduction was introduced under the Financial Emergency Measures in the Public Interest Act 2010 and was effective from 1st January 2011. It was extended and amended by the Financial Emergency Measures in the Public Interest Act 2013. The change was effective from 1 July 2013.
The reduction is applied to a pensioner’s gross annual rate of pension using a set of rates and income bands.
 
USC x 2 and PRSI x 2

Is there any chance that budget 2016 will see the end of the double charging of USC.

USC is paid on contributions and USC is paid on pension income. This is outrageous.

Also ARF withdrawls are subject to PRSI. If you are under 66 then you pay PRSI at 4%. Therefore if you retire early the mandatory 5% ARF withdrawal is subject to 4% PRSI until you reach 66.

When you do the numbers pension saving is not that attractive if you are going to retire early. USC x 2 and PRSI x 2.

I hope the minister is lobbied to change this in 2016.
 
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