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Nov, 2011

Top public servants can expect to pay more PRSI on their private income after the Budget, according to The Sunday Business Post, which says Government is preparing to remove a ‘block exemption’ from PRSI payments on private income, most of them hospital consultants who do not pay PRSI on earnings from treating private patients.

“The measure to address the PRSI loophole would raise an estimated €12m and applies to ‘modified rate contributors’ who are principally civil and public sector workers recruited before April 6, 1995,” the newspaper says. “Public servants earning more than €100,000 would be required to make a mandatory tax return if they have additional earnings including rent, investments and dividends. It is estimated that up to €80m a year could be saved by closing PRSI loopholes and extending the contributions net.”

The newspaper also notes a proposal to abolish the €200 back-to-school clothing and footwear allowance paid to parents on family income supplement or social welfare with toddlers aged under four. Youngsters qualify from aged two onwards, even though they don’t yet attend primary school.

“Cuts in the allowance and changes to eligibility criteria are also on the table, and indicate reductions in the €200 paid for children up to 11 years and the €305 for children aged 12 to 22. The payment of the allowance for these up to the age of 22 is also under scrutiny,” the newspaper reports.

The back-to-school allowance will cost the state €90m in 2012, up from €82m this year.

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