Our panel of experts took questions online from our readers. Below are excerpts from the session and the replies
PUBLIC SECTOR PENSIONS
I have just retired from the Civil Service. Will my pension be affected (it was based on my final salary) by the Budget? Thanks. – Edward Donelan
No, existing pensioners have escaped cuts from both a social welfare and public service pension perspective. However, it has been flagged that future increases to public service pensions will no longer be linked to pay rises but to the cost of living index.
PUBLIC SECTOR PAY
Hi there, I am wondering how the public sector pay cuts will affect me. I currently earn €31,215 in the public sector. Will 5 per cent be taken from the first €30,000 and 7.5 per cent from the next €1,215? – Susan Moloney
Yes, that’s correct – your total expected pay cut would therefore be €1,591 or approximately 5.1 per cent.
RETIREMENT AGE
Has the retirement age been extended to 66? I am due to retire in March. – Mary
The extension of the retirement age to 66 only applies to new employees entering the public sector from 2010. It will not affect the retirement dates of people who are due to retire shortly.
MORTGAGE INTEREST TAX RELIEF
Mortgage interest relief. Am I right in saying this was scrapped in the last budget, am I entitled to it again now after this Budget? – Mark Dempsey asked:
Mortgage interest tax relief was only scrapped in the last budget for non-first time buyers. Prior to the April budget, there were two rates of tax relief for mortgages: one for first-time buyers who are within the first seven years of their mortgage and a much smaller relief for other borrowers. The relief for other borrowers was abolished and remains abolished as of yesterday, so if you lost your entitlement you will not regain it. However, if you are still entitled to the relief for first-time buyers, you will now receive it until 2017.
JOBSEEKER’S ALLOWANCE
When do the jobseeker’s allowance cuts for 23-year-olds come into effect? – Matt Burke
Answer: The changes will come into effect from December 30th 2009 for new claimants aged 20-24. It seems that existing claimants before the introduction of the Budget will be subject to the old rules and rates, with one exception – where the individual has turned down job offers or training offers. In those instances, the rate will drop from €196 to €150 per week. Rate changes for existing claimants take effect from January 1st, 2010.
STAMP DUTY
Has the Budget affected stamp duty on houses? Is there to be a property tax? – Karen Banks
There was no change to stamp duty on houses. The Minister signalled that he planned to go ahead with the property or site valuation tax recommended by the Commission on Taxation. However, he noted that “considerable groundwork” had to be done before this could be implemented.
PRSI
Did the Minister raise the PRSI ceiling in the Budget for 2010? – Patrick OBeirne
No, despite speculation that the PRSI ceiling may be raised or even abolished, there were no changes announced in the Budget. The Minister did however announce the introduction of a unified social contribution scheme to replace PRSI, the health levy and the income levy to be introduced in 2011.
SOCIAL WELFARE
Will deserted wife’s benefit be affected by social welfare payment cuts. I am 66? – Andree Douglas
There will be no change in the rate payable to you. Deserted Wife’s Benefit will not be affected for people aged 66 and over, as the Government decided not to change any of the rates payable to this age group. People under the age of 66 who receive the Deserted Wifes Benefit will see the rate cut from €204.30 to €196 a week.
CARBON TAX
Has a carbon tax been placed on fossil fuels like coal and turf? Thanks – Joe Walsh
Yes. But unlike the carbon taxes on petrol and diesel, which take immediate effect, the carbon tax on coal, peat briquettes and heating oil will not come into effect until May. The price of a 40 kg bag of coal is estimated to rise by €1.79 as a result of the tax.
ARTIST’S TAX EXEMPTION
Has the Artist’s Tax Status been affected/reduced? – Yvonne Lynch
Answer: No, although it was mooted before the Budget that there would be a change to the artists’ exemption scheme, the Minister did not introduce any measures in this area yesterday, so artists’ tax status is unchanged.
The panel included Irish Timesjournalist Laura Slattery, economics commentator Pat McArdle and PriceWaterhouseCoopers tax managers Sean Walsh and Eimear OLoughlin