Increase in Effect of Public Sector Pension Levy

Dreaded_Estate

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The changes to the tax treatment of the public sector pension levy is expected to raise an additional €250m in a full year.

This is a 25% increase in the effective yield from the pension levy. From €1bn to €1.25bn. Therefore on average everyone can expect a increase of 25% with those on higher wages rightly facing a significantly higher increase.

Page 94
In addition, a consequential reduced rate of relief on the public service “pension-related deduction” will yield a further €240 million in a full year.
Haven't heard it mentioned much, though the unions would be up in arms with what is in effect an additional public sector pay cut.
 
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nonpartyboy

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It will take a few days for all these things to filter through....is there any reduction in the outrageous pay levels at the top ?.

Quick duck, it's a low flying pig..................
 

Dreaded_Estate

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It will take a few days for all these things to filter through....is there any reduction in the outrageous pay levels at the top ?.

Quick duck, it's a low flying pig..................
On second reading it would seem this change will hit higher paid public sector workers.

Anyone paying at the lower tax rate will pay nothing additional while those on over €100k will have an additional 2.5% pay cut.
 

nonpartyboy

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On second reading it would seem this change will hit higher paid public sector workers.

Anyone paying at the lower tax rate will pay nothing additional while those on over €100k will have an additional 2.5% pay cut.

The top levels across the board should be looking at 20% straight cut , the rises they received during the Bertie years were simply outrageous and that should also apply to semi states etc , maybe if some reality came into their payscales they might have some idea of what ordinary people can take.
 

civilserpant

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yup, its going to have a big impact, another 3-4% cut in take home pay. I pay 6.5% into pension (post 95), 7.7% in the pension levy and now losing the prsi & health levy relief on it and then the 2012-2014 reduction from 41% to 20%...

On top of tax bands, its going to hurt.
 

civilserpant

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The top levels across the board should be looking at 20% straight cut , the rises they received during the Bertie years were simply outrageous and that should also apply to semi states etc , maybe if some reality came into their payscales they might have some idea of what ordinary people can take.
So the Sec Gen in revenue, on 198k a year, managing a 6,000 person organisation should be on 159k a year... he'd be off to the private sector in a heartbeat. Dont assume all senior public servants are useless....
 

Macy

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The reduction in pension reliefs is a defacto cut in public sector pay for anyone at the marginal rate. I know I flagged this here a couple of times as an effective cut which would be very hard for the unions to argue against, because of the other types that will be potentially be hit. I would think many in the private sector can avoid a full hit by reducing pension payments, something public servants cannot.

I also noted the document only mentioned the pension levy, but it will also increase the tax deduction, PRSI deduction and Health Levy from any public servants over the marginal rate. Net public sector pay will be significantly reduced over the life of the plan.
 

gatsbygirl20

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yup, its going to have a big impact, another 3-4% cut in take home pay. I pay 6.5% into pension (post 95), 7.7% in the pension levy and now losing the prsi & health levy relief on it and then the 2012-2014 reduction from 41% to 20%...

On top of tax bands, its going to hurt.
Can somebody explain this please? Some contradictory analysis on the tax relief implications for the PS pension levy. Thank you.
 

Proposition Joe

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Can somebody explain this please? Some contradictory analysis on the tax relief implications for the PS pension levy. Thank you.
No PAYE, PRSI or health levy is current paid on your pension levy.

So say you're an average public servant on €50k base pay, minus €3,500 in pension levy.

Currently that levy is lopped off the top first, then all other deductions are applied to the remaining €46,500.

But from next year, full PSRI and health levy will be applied to the €3,500, costing you a few hundred a year.

From 2014 the real killer will be an extra 21% PAYE on the €3,500, which will cost an additional €735 a year.

Similar calculation for your approx €3k a year in superannuation contributions.
 

Broke

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No PAYE, PRSI or health levy is current paid on your pension levy.

So say you're an average public servant on €50k base pay, minus €3,500 in pension levy.

Currently that levy is lopped off the top first, then all other deductions are applied to the remaining €46,500.

But from next year, full PSRI and health levy will be applied to the €3,500, costing you a few hundred a year.

From 2014 the real killer will be an extra 21% PAYE on the €3,500, which will cost an additional €735 a year.

Similar calculation for your approx €3k a year in superannuation contributions.
If you are an average p.s on 50k I don't think you will go hungry after paying more tax to the goverment. It could be worse if you were on min wage.
 

sheehan

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What about those millionaires in RTE, ESB, CIE and the rest of the semi-state companies? People who work 4 hours a week for half a year?
 

deirdrem

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So the Sec Gen in revenue, on 198k a year, managing a 6,000 person organisation should be on 159k a year... he'd be off to the private sector in a heartbeat. Dont assume all senior public servants are useless....
Where would he go?
The banks are fúcked.
IFSC is fúcked.
Construction is fúcked.
The multinationals could easily go offshore again, cetainly I don't see them increasing numbers to warrant mass desertion of the Public sector. That horse has long bolted.
Ditto for consultants in the hospitals. If they get pay cuts they can go into private practice - except who will have money to pay them? Of course they could emigrate, but the same problem exists abroad.
 

marvin27

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Am I right in saying that by reducing the tax relief on the Pension Related Deduction - Public Servants will effectively be taxed on a levy???
 

Chrisco

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So the Sec Gen in revenue, on 198k a year, managing a 6,000 person organisation should be on 159k a year... he'd be off to the private sector in a heartbeat. Dont assume all senior public servants are useless....
That doesn't mean he's irreplaceable.
 

bogtrotter

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What about those millionaires in RTE, ESB, CIE and the rest of the semi-state companies? People who work 4 hours a week for half a year?
Like the millionaires in the private sector they are the untouchables, probably because they got those top jobs through their Fianna Fail connections and are contributors to the party coffers.

I hope (don't really believe) the incoming government in the new year will have a serious look at the problems in our economy and put a cap of 80 thousand Euros or therabouts on top people in the public sector and enforce similiar a cap in the private sector through the tax system.

There are a lot of very angry people in our country right now and they are not all in our public services...
 

havesomeimagination

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No PAYE, PRSI or health levy is current paid on your pension levy.

So say you're an average public servant on €50k base pay, minus €3,500 in pension levy.

Currently that levy is lopped off the top first, then all other deductions are applied to the remaining €46,500.

But from next year, full PSRI and health levy will be applied to the €3,500, costing you a few hundred a year.

From 2014 the real killer will be an extra 21% PAYE on the €3,500, which will cost an additional €735 a year.

Similar calculation for your approx €3k a year in superannuation contributions.
doesn't this make the original pension levy worse than a pay cut because now it's the equivalent of having your pay cut but still paying taxes based on what your pay used to be!! but of course it's now illegal for us to strike about this thanks to the CP deal which supposedly protected us from pay cuts - this is what happens when you keep rolling over you keep getting shafted
 

sheehan

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Like the millionaires in the private sector they are the untouchables, probably because they got those top jobs through their Fianna Fail connections and are contributors to the party coffers.

I hope (don't really believe) the incoming government in the new year will have a serious look at the problems in our economy and put a cap of 80 thousand Euros or therabouts on top people in the public sector and enforce similiar a cap in the private sector through the tax system.

There are a lot of very angry people in our country right now and they are not all in our public services...
I have talked about this already in another thread. It's not really a problem of public sector vs. private sector. It is about have and have nots. People who are rich and powerful in the society vs. people who are poor and powerless. You will find these kinds of people in both the public and private sector.
 

nonpartyboy

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So the Sec Gen in revenue, on 198k a year, managing a 6,000 person organisation should be on 159k a year... he'd be off to the private sector in a heartbeat. Dont assume all senior public servants are useless....
In my experience , responsibility is pushed down at all levels the only people who ever walk the plank are the ones at the bottom, managing 6,000 people is a stupid argument as all these places would run just fine without the 7 layers of management that currently exist, the current public service is simply one big management pyramid , where what the people below you are doing is irrelevant, the goal is to simply to have people undeneath you. so yes 159k is plenty of money for a relatively handy number, the problem with the people at the top is most of them are not in it for their country and public service ,but only for their pockets.
The higher up the chain you go the more greedy they get in my experience.
 

Expatriot

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PS pay has been cut again, again a sneaky pathetic way of doing it.

The unions are a useless shower. Another agreement they signed in earnest is a joke. Every single agreement my union has brought back to me in return for my membership fee has been cast into the bin. My membership fee is now going to double in Jan as my income takes a severe hit again. I will be needing a detailed cost benefit explanation of why I should retain my membership of that union now.

Paying someone to agree to me working a lot more for a lot less is someone I could do myself for free as far as I am concerned.

This is a pay cut pure and simple, it is a special PS tax. That is a pay cut. Just like the pension levy it is a cowardly disgraceful measure. You should have just cut our pay and pensions to the level you can afford two years ago and stop sowing all of these seed of division.

Please leave the stage now, you are a pack of lying traitors.
 


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