An individual may no longer be able to claim tax relief on contributions he or she makes to a pension fund after it reaches €1.5m – and possibly even less – under proposals suggested in the Programme for Government, The Sunday Business Post reports.
Chartered Accountants Ireland have reviewed the Programme of the “Government for National Recovery” published by the Fine Gael and Labour parties at the weekend. The programme contains some detail as to what can be expected in terms of tax policy. Among the tax proposals are the following:
The agreement to form the new coalition government between Fine Gael and Labour is based largely on consensus around taxation reform, The Sunday Times front page lead article reports.
Enda Kenny has already raised the prospect of selling state assets with the chief executive of Bord Gáis, John Mullins as a revenue-raising option under the new government, The Sunday Business Post reports.
The new government has revealed a central plank of the Smart Economy strategy – apparently, TDs and senators are to receive training on how to use Twitter and Facebook, according to a report in The Sunday Business Post.
There just ain’t no escaping it this week – all eyes are on Friday and what the fallout will mean for your pocket. The Sunday Times and The Sunday Business Post both offer comprehensive synopses (if that’s not an oxymoron) of the policies being promised by the main parties and how this will likely affect various strata of society.
Promises, promises … is there no end to them as the February 25 election day draws nearer? At least the electorate is beginning to get a clearer idea of what to expect on the tax front when the new government takes power. And, increasingly, it is looking like Fine Gael’s pronouncements on just about everything are the ones to watch.
Many election promises seem destined to be broken at the best of times but in the worst of times, they are likely to gather dust on the shelves of the parties’ headquarters whether there is a will to implement them or not.
Tax policy is beginning to take centre stage and will likely play a pivotal part in which party or parties govern the country after the election on February 25th. The Sunday Business Post leads with Fine Gael’s pledge to retain pension tax relief at 41% – something to be particularly mindful of as it looks odds-on to be the main party in government shortly.
“Fine Gael will attempt to attract middle-income voters with new tax plans this week, including a commitment to retain tax relief on pension contributions at 41%, rather than cutting it to 20% as promised in the four-year plan,” according to the newspaper’s editor Cliff Taylor and its political editor, Pat Leahy. “This would remove a significant threat to the incomes of middle and higher earners, who would have faced a higher income tax bill as the relief was progressively cut.”
Fine Gael is expected to unveil its plans on Thursday, where it will also promise not to increase income taxes any further even if public finances come under further pressure.
The same article points out that Labour is at odds with Fine Gael’s acceptance of the spending cuts imposed under the four-year plan, claiming they would drive the economy deeper into recession. It proposes to extend the target for reducing the budget deficit to 3% by a year to 2016 and to impose a higher universal social charge of 10% on earnings above €100,000.
In a rare display of consensus, all of the major political parties have told Europe where to get off regarding mooted proposals from Germany and France to increase Ireland’s corporate tax rate. Their resolve is no doubt being steeled by warnings of the catastrophe awaiting what’s left of the economy if the 12.5% rate was to go.
The Sunday Times reports on remarks made by Ryanair’s Michael O’Leary earlier in the week that the airline “will lead the charge overseas” if the rate is increased.
O’Leary said Ryanair had “made it very clear to the Irish Government” that “significant” increases in corporate tax would see the airline move its headquarters overseas.