Minister for Finance Michael Noonan followed through this time on his commitment not to further extend the private sector pension levy.

First introduced in 2011 as a four-year measure to fund the Government’s Action Plan for Jobs, including a lower VAT rate for the tourism sector, it was the first exercise in retrospective taxation in the history of the State.

The 0.6 per cent levy was applied to the full value of funds invested in private sector pension schemes on January 1st of the respective year.

In 2014, the Minister said he was ending the levy as promised only to introduce a new two-year scheme which effectively raised the 2014 levy to 0.75 per cent, falling to 0.15 per cent this year.

“Deputies may recall that the Government introduced a pension fund levy to finance the reduced rate of VAT and the other measures in the Jobs Initiative that I presented to the House in 2011, shortly after taking office,” the Minister said in his Budget speech.

“The pension fund levy has done its job and is no longer needed to fund the 9 per cent VAT rate because it is more than made up by increased activity and employment. So I can confirm that the remaining pension fund levy of 0.15 per cent introduced for 2014 and 2015 will end this year and not apply in 2016.”

The levy has raised more than €2 billion over the past five years. That companies with roughly a €550 million annual yield from the local property tax and noticeably less again form water charges.