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Dublin: 14 °C Tuesday 21 May, 2013

SIPTU president urges Taoiseach to introduce pensions tax sooner

In a letter to Taoiseach Enda Kenny, Jack O’Connor says that introducing the 41 per cent rate on pensions over €60,000 sooner would obviate the need for certain cuts.

Jack O'Connor
Jack O'Connor
Image: Laura Hutton/Photocall Ireland

SIPTU GENERAL PRESIDENT Jack O’Connor has written to Taoiseach Enda Kenny urging him to bring forward plans to limit the tax relief on pensioners earning over €60,000 annually.

In a letter (published in full below) O’Connor says that implementing the measure next year rather than the year after, as the government has said, would generate an extra €125 million for the Exchequer.

The government plans to claim 41 per cent of the value of pension payments in excess of €60,000 per year but the measure will not come into effect until 2014 due to legal issues.

O’Connor has asked Kenny to intervene in the matter personally and says that all of the arrangements could be put in place for the measure to be implemented by the 1 July next year, negating the need for some cuts to services.

He said that it “would also serve to go some way towards contributing to social cohesion at this crucial moment in our history”.

Read the letter in full:

Read: SIPTU condemns ‘fascist behaviour’ at  austerity protest

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Comments (34 Comments)

  • Interesting , however early paying of pensions before age 65 is the real issue , if you qualify for a pension it should be held until retirement age, example politicians , all have ability to earn a living after politics, so no pension should be paid until 65

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    • I agree with Shay…… It is indeed very strange that all the trade union leaders seem to have facial hair. What are they hiding? Is it a protest against Gillette’s policy of refusing to employee real people instead of their current nimble fingered chimpanzees? One can only speculate…

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    • So what would expect me to live on????? Age 45, 24 years service in the army , collecting a pension that covers all my outgoings…. Set up a business with a friend and getting paid 500 euro……….. A YEAR. If I had an income of say 45,000 a year I would thoroughly agree with the pension withdrawal but until that day comes I think I am entitled to draw down a pension I earned .

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  • Cmon Jack, why are you writing a letter?? .. Just go into ‘Taoiseach’ under’ favourites’ in your phone and text him!!
    No mention of a cut yourself either Jack?

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    • What’s with this legal issues excuse? Another cop out designed to give the rich and powerful time to hide their money elsewhere. There’s nothing to stop this being introduced on the 1st of January. If the government can reduce respite money that carers get next month, there’s nothing to stop them reducing tax relief on big earners pensions. In fact I’d bring it down to €50,000.

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    • no how right you are. what about a cut in Union Fees. it is about time now

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    • Union fees are paid by members, not the taxpayer. The same as O’Connor’s salary. Only SIPTU members have the capacity to reduce his pay.

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  • Will it apply to new pensions only or will it include the massive pensions already being paid out. Any estimates on how much it’ll bring in?

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    • Ben Gunn 08/12/12 #

      It will only apply to pensions not yet in payment. Under the proposed rules tax relief will only be available on contributions for pensions planned not to exceed €60,000 per annum.

      For a defined benefits scheme this is a straight forward calculation. However, for defined contribution schemes it is not so simple. You will have to calculate how large a pension pot has to be, to produce a pension of € 60,000 and under what circumstances it is payable. I could for example make a case that for a pension of € 60,000 pa starting at age 60 with a widows pension of €40,000 with uplifts to keep pace with the RPI would need a pot of €3,000,000. If I had only 20 years to build such a fund , well you see the problem, I would be able to tax shelter huge sums every year.

      Another issue is public sector pensions. How due you value the notional contributions made by the state on for these and will those contributions be taxed as salary?

      Sorting out these complications is what the government means by “legal issues” .

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  • Instead of taxing people who are putting money into actual pension funds, perhaps something should be done about people who are taking pensions out of other people’s pockets…where there is NO fund.

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  • Jack has some neck, he is as responsible for the mess this country is in as his social partners In FF.
    His union has stood over benchmarking and over staffed public service for years. That with the croke park farce is leading to bankruptcy and the continuing cuts to the poor and needy! It’s time he is made answer for his guilt in Ireland’s demise

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  • Yes, Jack. Champion of the working man you are. How much are you earning, again?

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  • makes sence

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  • I wish somebody would calculate Jacks total income from his various streams including allowances and expenses.
    I think it is over €450,000. How many boards is he on? How many committees? 1st class travel on Aer Lingus for all his family? Etc etc.
    The cheek of this man and other union heads requesting anything – they are a bigger contributed to our debts than the politicians. And to think they still feel they represent the citizens of Ireland is downright insulting.
    Sadly these guys are in such a position as people won’t walk with them in protest. People can’t stand our union leaders and protests should be organised against these individuals. Divide and retire with big pensions Jack.

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    • That entire argument is whataboutary. Also it’s mud slinging – he may not be that rich.

      The only question is should pensions over 60k be taxed at the same rate as salaries. Of course ( and so should all income )

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    • Ben Gunn 08/12/12 #

      All pensions of whatever size are taxable as income and at the same rates as any other income. This proposal is about limiting tax relief on the amount you pay into a pension scheme.

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  • Jeff 08/12/12 #

    Austerity? In 2002, Irish govt spending was €44bn. In 2013 it will be some €70bn…. That right Tax us private sector workers more …….

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  • Methinks ole Jackie boy is worried about his own cushy job now…all of a sudden he’s trying to be a socialist…but Jack Ive news for you…It just isnt working…we are not convinced!!! Biggest favour that SIPTU could do for themselves….is get rid of the current leadership, and start again.

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  • One word for Jacko..Sellout

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  • Eire 08/12/12 #

    Jack the ( Over Paid ) Socialist (Ha) leader accuses people who don’t listen to him , & his kind as Fascists ! So now he takes to writing to one Heir Kenny as his merry band of Blue Shirt Brigade !

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  • …..says the man who took his place alongside David Begg at the pig trough.
    No dice, Jackie boy. It’s a case now of too little too late. Do this country a favour and take a swim with some concrete flippers.

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  • Jazus Jack you have finally woken up, how long are we in this crisis

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  • I rarely agree with the various union leaders, but I’m in agreement on this one. Add to it a cap of €100k maximum combined total pension payable by the state regardless of how many different state jobs or appointments you have or how senior you were and qualification for any state pension only at the official retirement age.

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  • It is put off to allow the government to back out of this provision on pensions. Let’s wait and see. Remember FF said they would have approx 90% tax on payments to bankers. Did it happen?

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  • No one should get a pension from the taxpayer greater than the average industrial wage, and qualify for only one state pension only at the official retirement age.

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  • He’d do better to take a pay cut

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  • padraig 10/12/12 #

    The union beards are selfless lads since their pensions are well in that category.

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  • How will the legal issues be resolved in a few years?

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