€97m pension tax relief inequity denounced

Taxation: The State's top 4,500 earners receive €97 million in tax relief on their pension contributions, party spokeswoman …

Taxation:The State's top 4,500 earners receive €97 million in tax relief on their pension contributions, party spokeswoman on social and family affairs RóisíShortall told delegates.

She said the figures revealed "just how much the system of tax reliefs is tilted in favour of top earners".

Ms Shortall said the figures, revealed by way of parliamentary question, dated back to 2004 and related to retirement annuity contracts and personal retirement savings accounts only.

"It is likely that the amount involved has increased substantially since then and is now well over €100 million annually," she added. "On average, the tax of top earners was reduced by €20,532 through tax relief on payment into private pension schemes, the equivalent of almost two annual old age pensions."

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She said that those on average wages, who were also paying into private schemes, had their tax reduced by just an average of €627. Top earners, she said, benefited 33 times more than those on average wages, and by 236 times more in the case of those in the lowest income bracket.

Meanwhile, Mary Murphy, Finglas, Dublin, claimed that some lone parents could not even afford the conventional Sunday dinner.

She said there were myths surrounding lone parents, but the reality was they struggled to pay electricity bills and were sometimes unable to maintain their houses or buy clothes.

Calling for a reform of the system, she said the current welfare schemes trapped them in lone parenthood.

Michael O'Regan

Michael O'Regan

Michael O’Regan is a former parliamentary correspondent of The Irish Times