Minister for Finance Brian Lenihan told the Dáil today he may consider revising the public service pensions levy in the future but warned the measure “will be part of the landscape for a long time to come”.
Mr Lenihan was responding to a question from Fine Gael deputy spokesman on finance Kieran O’Donnell.
The minister rejected suggestions the levy was unfair on the lower-paid.
“The levy is not unfair. We have taken a graduated approach to ameliorate the burden on the lower paid. Those on higher salaries pay higher tax and a higher percentage of their income will go on the levy,” he said.
“The overall picture is that we need savings in the public sector bill. These savings must be made.”
However, Mr Lenihan suggested the levy could be revised, adding: “I would not rule out consideration of other banding options that may be brought forward once the savings are equivalent.
“But the savings must be equivalent and that is fundamental in relation to the operation of the levy.”
Legislation to give effect to the Government levy on public service pensions was published earlier today.
Under the Bill, public servants earning over €20,000 will pay a 10 per cent levy on their salaries, while those earning less will be liable to pay the levy at a reduced rate.
Anyone earning up to €15,000 will pay a rate of 3 per cent, while those earning between €15,000 and €20,000 will pay six per cent.