Row over levies increase for up to 9,000 civil servants

A ROW between the Department of Finance and the Civil Public and Services Union has erupted over the introduction of the increased health and income levies, which came into effect yesterday.

Up to 9,000 clerical officers and similar grade civil servants were caught for the increased levies, introduced on May 1st, when their pay packets were delivered yesterday.

But their higher grade colleagues, from staff officer grade upwards, who were paid on Thursday, managed to avoid the levy.

The anomaly occurred because clerical grade staff are paid every Friday on a weekly basis, while higher grades are paid on Thursdays, on a fortnightly basis.

The higher levies were due to take effect from Friday and so came out of cheques paid on that day. But clerical officers had expected that days worked earlier in the week would be taxed at the lower rates. They now believe they are owed four days’ levies, but the Department of Finance does not agree.

Eoin Ronayne, assistant general secretary, said wage packets were lighter by between €16 and €22 and said it was not good enough. He claimed the department had confirmed the deductions were wrong and had agreed to repay the money at the end of the year.

But the end of the year was too late, he said, and the deductions amounted to adding salt to the wounds of workers who had already been hammered by the pension levy.

“We are examining our options in relation to the payment of wages Act,” he said.

The department said that the anomaly occurred because of the way the tax system works. The levy was applied to cheques payable on May 1st as opposed to hours worked from May 1st.

“When tax reductions were applied in the past from January 1st on work done in December, no one complained about that,” a spokeswoman said.

She said she could not confirm that any negotiation with the CPSU had resulted in a commitment to repay the four days of levies at the end of the year.

“The rebate is not going to happen, it’s tax law,” the spokeswoman said.

Tax measures

Income Levies: Income levy rates have doubled as of May 1st and the thresholds lowered. The threshold below which the income levy does not apply falls to €15,028 per annum (€1,252 per month or €289 per week) from €18,304. However, if you earn more than that, you will pay a levy of 2 per cent on all income up to €75,036. On income between €75,036 and €174,980, the levy will be charged at 4 per cent and at 6 per cent on all amounts over €174,980.

Health Levies:May 1st also saw health levies double. On income up to €75,036, the levy will now be 4 per cent. Above that, a 5 per cent levy applies.

PRSI: The ceiling for payment of PRSI increased from yesterday to €75,036 (or €1,443 per week) from €52,000 previously.

Jobseeker's Allowance: People under the age of 20 looking for financial assistance under Jobseeker's Allowance are now restricted to a maximum means-tested payment of €100 a week (down from €204.30). They may be restricted to a maximum claim of €100 per week for a qualified adult, down from €135.60.

Early Childcare SupplementThe supplement payable to families with children under the age of five has been halved to €41.50 per month per child from yesterday and will be phased out by the end of the year.