Credit Card Switching and Govt Tax - BoI Ripoff?

Daibheid

I've just about lost patience with my BoI credit card and wanted to take up a better deal with Halifax. So I tell BoI to cancel the credit card at the end of the €30 Govenrment tax year so I can switch without getting hit twice in the one year. Here's their written response after the how dissappointed we are and please call us on 1850.... to discuss.

Govt tax is " applicable on April 1st each year for the year gone by on every credit card account regardless of issuer. Unfortunately, we are now also obliged to charge this tax on closure of an account for the year ahead, as the credit card account has been maintained in the current year."

I can't believe this is true. We have our Government Minsiters in return for ridiculous salaries advising us we should shop around for value and then creating a restrictive practice where it can cost at least €30 tax to close one account and open another but BoI are saying it'll cost me €30 for the year gone, €30 for the year after I cancel the card plus of course the €30 Halifax will charge. It's already a significant barrier to switching providers unless you time it right - as I thought I had. But now it seems to be even more restrictive.

BTW I did call to discuss four times - first they were gone home at 17.05:( despite publsihing office hours as 17.15 and the other three times wait time was an average 12 minutes to no avail. So I can't get them on the phone to confirm what they've written and april 1st is coming fast after which I'll have been charged for next year anyway. Anyone know if BoI are correct or just trying it on to pass the magic April 1st when I'll have been hit for €30 for the next year?

loyatemu

they always charge you the levy when you close your account, but they will give you a letter to pass onto halifax so they don't double-charge you. The charge is now €30 btw.

jor el

I see the way it works now. You pay on Apr 1st, but for the previous year. So you pay on Apr 1st, 2009, for the year Jan-Dec 2008. As we're now in 2009, this years payment is due, which would be taken on Apr 1st, 2010, but also on closure of the account. That's a bit of a crazy way to do it, IMO.

December is therefore the right time to close a credit card account, if you want to get the most from the tax paid.

This is not a bank rip-off, it's a stupid tax. None of the banks get a choice in it.

dudara

Moved to Banking & Insurance & Pensions

dudara

homer911

The tax is based on usage in a calendar year, levied on April 1st. If you dont use it you dont pay. If you use it once on Jan 1st, you are due to pay tax on April 1st of the following year, or earlier if you close the account

GerardKeating

Daibheid wrote: »

I've just about lost patience with my BoI credit card and wanted to take up a better deal with Halifax. So I tell BoI to cancel the credit card at the end of the €30 Govenrment tax year so I can switch without getting hit twice in the one year. Here's their written response after the how dissappointed we are and please call us on 1850.... to discuss.

Govt tax is " applicable on April 1st each year for the year gone by on every credit card account regardless of issuer. Unfortunately, we are now also obliged to charge this tax on closure of an account for the year ahead, as the credit card account has been maintained in the current year."

I can't believe this is true. We have our Government Minsiters in return for ridiculous salaries advising us we should shop around for value and then creating a restrictive practice where it can cost at least €30 tax to close one account and open another but BoI are saying it'll cost me €30 for the year gone, €30 for the year after I cancel the card plus of course the €30 Halifax will charge. It's already a significant barrier to switching providers unless you time it right - as I thought I had. But now it seems to be even more restrictive.

BTW I did call to discuss four times - first they were gone home at 17.05:( despite publsihing office hours as 17.15 and the other three times wait time was an average 12 minutes to no avail. So I can't get them on the phone to confirm what they've written and april 1st is coming fast after which I'll have been charged for next year anyway. Anyone know if BoI are correct or just trying it on to pass the magic April 1st when I'll have been hit for €30 for the next year?

BoI are correct and all banks apply the rules the same way.

The charge due next week is for last year, so (assuming you used the card in 2009) they will charge you 2008 and 2009 stamp duty.

Mostly likely every one will pay double next month, since changed the Stamp duty to current year rather than in arrears is a quick fix to bring in some east dosh.