0.6% Pension levy, start of something more serious?

g_moriarty

http://www.breakingnews.ie/ireland/hobbs-outraged-at-levy-on-private-sector-pensions-504670.html

Hobbs 'outraged' at levy on private sector pensions

Read more: http://www.breakingnews.ie/ireland/hobbs-outraged-at-levy-on-private-sector-pensions-504670.html#ixzz1M3jlbz9C

11/05/2011 - 16:25:20
There is fury in some quarters at Government plans to tax the pensions of private sector workers.

It is to impose a 0.6% levy on private pension funds in a bid to fund the new jobs initiative scheme, details of which were announced yesterday.

This equates to around €500 per worker.

Eddie Hobbs said he is "outraged" over the proposal.

Mr Hobbs said: "This is actually taking your property without your permission by forcing the administrators and setting aside the trustee law to try and get their hands on your money.

"That raises a very serious issue because it now means that there is an elevated risk and reasonable doubt over money held in any Irish financial institution, including credit unions and bank deposits.

"Once the Government are allowed to step over the line, it means that they can do it with anything. The €100bn held in cash deposits in Ireland is now at risk of similar action."

That last paragraph is particularly worrying but raises an interesting point. Are the government "testing the waters" , seeing how much they can get away with? What are the chances they will start eyeing up our deposits next? I don't mean raising DIRT, or taxing pension contributions - but actually targeting that cash directly. Surely there are international/EU laws to protect from this.

RichardAnd

g_moriarty wrote: »

http://www.breakingnews.ie/ireland/hobbs-outraged-at-levy-on-private-sector-pensions-504670.html


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That last paragraph is particularly worrying but raises an interesting point. Are the government "testing the waters" , seeing how much they can get away with? What are the chances they will start eyeing up our deposits next? I don't mean raising DIRT, or taxing pension contributions - but actually targeting that cash directly. Surely there are international/EU laws to protect from this.

I've been thinking about this myself. I don't know what the EU laws about this are but even if they did exist, I'd expect there are ways around them. What I do know is that this has happened before in other bankrupt countries and there is a word for it in finance, which I'm sure other posters will know?

I suppose buying a shot gun and taking out my savings seems less crazy now?

Squall19

Would moving to an english based bank or other foreign online bank like rabo or something get you out of this potential disaster?

They are already charging huge dirt tax as it is.

lmimmfn

all capital is getting taxed without it even being liquid, share schemes, pension funds, home owner tax, you can be 100% sure that deposit/savings accounts are next.

For the first time, im looking at moving my money( lol, the very little i have ) abroad, dont trust anything here anymore, its like having a dictator in control of the country.

dan_d

I'm inclined to agree.

Does anyone out there know anything about pensions?!

RichardAnd

Squall19 wrote: »

Would moving to an english based bank or other foreign online bank like rabo or something get you out of this potential disaster?

They are already charging huge dirt tax as it is.

Apparently it's not that simple, surprise surprise.

http://www.boards.ie/vbulletin/showpost.php?p=72147124&postcount=12

ei.sdraob

The bank run is about to get runnier

oh dear

DoesNotCompute

Some of us don't have any savings. Those of us struggling to keep our heads above the water can't afford to save, us the cost of living is through the roof

Squall19

RichardAnd wrote: »

Apparently it's not that simple, surprise surprise.

http://www.boards.ie/vbulletin/showpost.php?p=72147124&postcount=12

How hard is it to get a pps number in the uk, poland etc:D

g_moriarty

DoesNotCompute wrote: »

Some of us don't have any savings. Those of us struggling to keep our heads above the water can't afford to save, us the cost of living is through the roof

This isn't relevant to you so..

ei.sdraob

RichardAnd wrote: »

Apparently it's not that simple, surprise surprise.

Its as simple as taking a cheap flight to Switzerland and opening a private account.

CiaranC

RichardAnd wrote: »

Apparently it's not that simple, surprise surprise.

http://www.boards.ie/vbulletin/showpost.php?p=72147124&postcount=12

Why are you quoting that poster as some kind of authority? He has been wrong pretty much every step of the way since this crisis started.

Its obvious that if people havent already, its time to research how best to protect their savings. Sooner rather than later.

ei.sdraob

CiaranC wrote: »

Why are you quoting that poster as some kind of authority? He has been wrong pretty much every step of the way since this crisis started.

yep


a good idea for people would be lookup what happened in other countries in the past when they got into so much debt, because you know "we are different"

billyboy01

Ruari Quinn more or less, just admitted on the George Hook Radio Show, that this state is bankrupt, and all assets and deposites are up for grabs!:rolleyes:

ei.sdraob

billyboy01 wrote: »

Ruari Quinn more or less, just admitted on the George Hook Radio Show, that this state is bankrupt, and all assets and deposites are up for grabs!:rolleyes:

Is there a podcast available?

maybe the National Assets Management Agency should start selling some of its ours "assets" :P

billyboy01

ei.sdraob wrote: »

Is there a podcast available?

Yeah on newstalk.ie, there's a realtime player!

ITUPE

What's the odds that this one ends up before the HIGH COURT! Maybe this is enough to drive people to protesting "Enough is Enough". All we need now is for a legal firm and a team of barrister's to come forward, and pledge an undertaking that they will provide their professional services pro-bono:D!

Bards

billyboy01 wrote: »

Ruari Quinn more or less, just admitted on the George Hook Radio Show, that this state is bankrupt, and all assets and deposites are up for grabs!:rolleyes:

What is the difference between the IRA robbing £20M fom Northern Bank and the Govt nicking €2,000M over the next 4 years.

they are both thieving scum in my eyes

beeftotheheels

ITUPE wrote: »

What's the odds that this one ends up before the HIGH COURT! Maybe this is enough to drive people to protesting "Enough is Enough". All we need now is for a legal firm and a team of barrister's to come forward, and pledge an undertaking that they will provide their professional services pro-bono:D!

On what basis? The rights of governments to levy taxes is well established.

Bards

ITUPE wrote: »

What's the odds that this one ends up before the HIGH COURT! Maybe this is enough to drive people to protesting "Enough is Enough". All we need now is for a legal firm and a team of barrister's to come forward, and pledge an undertaking that they will provide their professional services pro-bono:D!

Time is now for the people to take to the streets and refuse to pay Road-Tax, TV License etc. they can't arrest all 4.5m of us

ei.sdraob

beeftotheheels wrote: »

On what basis? The rights of governments to levy taxes is well established.

With rights come responsibilities.

Pitty the government (past and present) can not be held accountable for waste and be responsible with the money collected, when it all goes wrong > sure its all "groupthink" excuse is used :rolleyes:

Tora Bora

Bertie Ahearne 's pension income will not be affected as a result of this move.

FFS.

beeftotheheels

ei.sdraob wrote: »

With rights come responsibilities.

Pitty the government (past and present) can not be held accountable for waste and be responsible with the money collected, when it all goes wrong > sure its all "groupthink" excuse is used :rolleyes:

I have never disagreed with that, nor used groupthink as an excuse for individual responsibility for what happened. I'm dying to see Seanie Fitz and co have their day in Court, I love that a High Court judge this week publicly questioned the lack of cases coming before the bench where he saw prima faicie breaches of the law.

I was simply asking what legal basis the poster was suggesting should be used to challenge the tax. The only one that strikes me is the potential conflict with the CDD in relation to certain bonds, but I don't see an analysis for the tax being illegal in and of itself.

ei.sdraob

Tora Bora wrote: »

Bertie Ahearne 's pension income will not be affected as a result of this move.

FFS.

You think I am sure he "re-invests" alot of his "winnings" at horse races.

thebman

Here is an idea, rather than screwing with our pensions, why not put a tax on trackside betting.

1. The current rate of tax on off course betting is 10%, - having been reduced from 20% in 1985. Betting at the racetrack is not subject to betting tax in Ireland or England. In Ireland this applies both to bets on the races made at that track itself, or made on a race elsewhere e.g. a bet made at Leopardstown in respect of a race at Catterick. On track bookies pay 5% to the Irish Horseracing Authority, these levies are not within the remit of this note. The Revenue Commissioners have no role in relation to such charges.

http://www.finance.gov.ie/viewdoc.asp?fn=/documents/Publications/tsg/tsg9839.htm

btard

I sympathise with Mr Hobbs and agree with most of what he says on this matter. He is calling it 'theft tuesday'. However, I don't remember him being 'outraged' 2 years ago when legislation was rushed through to renege on my contract and rob me of 7% of my income. Or indeed last year when they robbed me of another 6% of my income. From what I remember he told us to "get real" when we objected.

So now it's your little nest egg they're going after and you're 'outraged'. Well Mr Hobbs, welcome to reality.


First they came for the communists
and I didn't speak out because I wasn't a communist.

Then they came for the trade unionists
and I didn't speak out because I wasn't a trade unionist.

Then they came for the Jews
and I didn't speak out because I wasn't a Jew.

Then they came for me
and there was no one left to speak out for me.

Bards

btard wrote: »

I sympathise with Mr Hobbs and agree with most of what he says on this matter. He is calling it 'theft tuesday'. However, I don't remember him being 'outraged' 2 years ago when legislation was rushed through to renege on my contract and rob me of 7% of my income. Or indeed last year when they robbed me of another 6% of my income. From what I remember he told us to "get real" when we objected.

So now it's your little nest egg they're going after and you're 'outraged'. Well Mr Hobbs, welcome to reality.


First they came for the communists
and I didn't speak out because I wasn't a communist.

Then they came for the trade unionists
and I didn't speak out because I wasn't a trade unionist.

Then they came for the Jews
and I didn't speak out because I wasn't a Jew.

Then they came for me
and there was no one left to speak out for me.

We've all lost income - but this is not income, it is savings. Savings that I will not be able to access for another 20+ years, yet the Govt has no problems accessing it today

tippx

Bards wrote: »

Time is now for the people to take to the streets and refuse to pay Road-Tax, TV License etc. they can't arrest all 4.5m of us

You know in Greece austerity Fatigue has set in and people are refusing to pay services en masse, eg on the trams they are saying I have no money to pay the fare and so on I think their has been a lull in public anger to give this crowd the benfit of their first 100 days in office ,they have been slack with ECB and not showed balls now they are pushing the wrong buttons over this pension grab out of the blue (so much for openess and transperency) keep on pushing and people will shove sooner or later

beeftotheheels

thebman wrote: »

Here is an idea, rather than screwing with our pensions, why not put a tax on trackside betting.



http://www.finance.gov.ie/viewdoc.asp?fn=/documents/Publications/tsg/tsg9839.htm

I think we are going to see a lot of things which weren't previously taxed, being taxed going forward and I see no reason why trackside betting should not be one of them.

But you have to bear in mind the manpower required to enforce collection of the tax from the bookies (am I doubting that they would leap to comply?) and the actual amount of tax that that would raise.

Having been to the races recently the attendance was way below what it used to be, I suspect that betting may have fallen off with the Celtic Tiger (although if anyone has facts and figures I'd be delighted to be proven wrong).

Pension funds are easier, the tax can be quantified and will be easily collected. It also doesn't have an immediate negative impact on the amount people have to spend now, so the theory would be that it won't hurt the economy in the way an increase in income tax would.

But if it is being used to justify a run on all assets then it will hurt the economy, possibly worse than an increase in income tax.

motherriley

It is similar in the Uk the government is messing up state pensions something shocking. We are born free but taxed to death.

If my income is over 9k a year then any extra income will be taxed at 20% and that is not all if my state pension is over £140 in 2015 this will be reduced as well. :mad:

People who have been working and paid in 40 years of NI will have to continue working for another 2 years or more and then they will be given less for their extra NI

beeftotheheels

tippx wrote: »

You know in Greece austerity Fatigue has set in and people are refusing to pay services en masse, eg on the trams they are saying I have no money to pay the fare and so on I think their has been a lull in public anger to give this crowd the benfit of their first 100 days in office ,they have been slack with ECB and not showed balls now they are pushing the wrong buttons over this pension grab out of the blue (so much for openess and transperency) keep on pushing and people will shove sooner or later

And that is working so well for Greece

http://www.bbc.co.uk/news/world-europe-13356923

http://www.bbc.co.uk/news/business-13352116

tippx

while Im on a rant LEO VARADKAR no one has gone to trial never mind jail ,corporate enforcement my arse..........

beeftotheheels

tippx wrote: »

while Im on a rant LEO VARADKAR no one has gone to trial never mind jail ,corporate enforcement my arse..........

Not sure what Leo is doing in the middle of that sentence - is his name now being used as a swear word? - but at least you can be happy that a High Court judge agrees with you (as do I and I suspect most other posters).

ITUPE

I am no legal expert, but I would have thought the most obvious challenge would be the legality of a levy that is applied retrospectively on the funds that you have already invested over the years.

A side issue is this Govt's pensions policy. Govt policy over the years vis a vis various aspects of social policy actively encouraged people to invest in their old age by putting money into private pensions, and they kept telling us about the impending pensions timebomb that was just around the corner.

So maybe both Lab and FG can now tell us what exactly their pensions policy is to deal with this grey timebomb?

tippx

beeftotheheels wrote: »

And that is working so well for Greece

http://www.bbc.co.uk/news/world-europe-13356923

http://www.bbc.co.uk/news/business-13352116

What is your point exactly people not should protest?,their is always some people who will cause trouble you have not read your own post,properly I presume .20000 people marched with minor trouble that day in Greece. Hey I know its been said but this is a sick situation for Ireland and I am personally fed up of being a "good european"it has got us know where in the last 3 years ,oh sorry wrong there may be a possibilty that they shave 1% off the principle .On the other hand the Greeks threten to pull out of the euro and go back to the drachma that focused the minds of ECB/Bundesbank fairly rapid that they called a "secret meeting" maybe you just want to sit back and take it ,dont mind telling I voted sinn fein on this point

swordofislam

ei.sdraob wrote: »

With rights come responsibilities.

Pitty the government (past and present) can not be held accountable for waste and be responsible with the money collected

Bit quick to write off the present government. The Irish state has the right to tax its citizens. Those who are more concerned with the protection of their own wealth than the fate of their country are traitors.

Permabear

This post has been deleted.

swordofislam

ITUPE wrote: »

I am no legal expert, but I would have thought the most obvious challenge would be the legality of a levy that is applied retrospectively on the funds that you have already invested over the years.

All taxes are applied retrospectively and changes to government policy are a risk of doing business, the previous government were traitors this government will not perpetuate their treason.

beeftotheheels

ITUPE wrote: »

I am no legal expert, but I would have thought the most obvious challenge would be the legality of a levy that is applied retrospectively on the funds that you have already invested over the years.

This is how wealth taxes apply. Lets fly away to a fictional place here - Utopia.

You live in Utopia, and its system is much like Ireland's (without the crisis). You bought a second property, as an investment, back in 2000 for €100k. The property is now worth €400k and you want to realize your investment. So you sell it, and pay 25% CGT on the appreciation in value.

This doesn't scare us, because we are used to it an expect it.

You also paid stamp duty when you bought the house but again you expected this.

Now, instead of waiting until the end, the government wants some cash now. So it levies a wealth tax on the property value. Because you don't have any cash it cannot expect you to pay 25% of the appreciation each year, you won't have the cash until you sell the property in year 11. So instead they levy a tax of say 1% of the property value each year.

This might scare you a bit, but it is not that far off rates (council tax if you've lived in the UK), so it is not as scary as the wealth tax on pension funds. But it is just the same thing only on property rather than pension funds.

Annual wealth taxes are usually low (less than 1%) and they are quite common around Europe (although not necessarily in pension funds). What is scary about this is that we didn't see it coming, and it is a new type of tax for Ireland.

But new does not mean illegal.

ITUPE wrote: »

A side issue is this Govt's pensions policy. Govt policy over the years vis a vis various aspects of social policy actively encouraged people to invest in their old age by putting money into private pensions, and they kept telling us about the impending pensions timebomb that was just around the corner.

So maybe both Lab and FG can now tell us what exactly their pensions policy is to deal with this grey timebomb?

I'm afraid that in the current climate pension provisions for the future will get traded off against being able to pay our bills today.

tippx

swordofislam wrote: »

Bit quick to write off the present government. The Irish state has the right to tax its citizens. Those who are more concerned with the protection of their own wealth than the fate of their country are traitors.

Define wealth....?

BornToKill

Eddie Hobbs is outraged? is that Eddie 'Cape Verde' Hobbs? Does anyone seriously listen to what he has to say anymore?

thebman

beeftotheheels wrote: »

I'm afraid that in the current climate pension provisions for the future will get traded off against being able to pay our bills today.

Yes however picking pensions is a particularly poor choice given we are going to have a massive shortfall in future and we are trying to get people who don't have one to start one.

The government is basically saying, you need to start a pension now give us .6% of it.

With PRSA's and the like, we will probably see pensions becoming mandatory in the next few years so it will be you have to contribute X amount to your pension and we are going to take .6% of that and at which point we will most likely see incentives to contribute axed as they will be mandatory.

Honestly looks like that is the way it is going to me

swordofislam

thebman wrote: »

Yes however picking pensions is a particularly poor choice

It is a great choice target those who benefited most from the tiger.

swordofislam

BornToKill wrote: »

Eddie Hobbs is outraged? is that Eddie 'Cape Verde' Hobbs? Does anyone seriously listen to what he has to say anymore?

I think his new name is Eddie 'No Gold Bubble' Hobbs.

paddy0090

FYI Atlas shrugged was Objectivism not Libertarianism

So people who are concerned with the protection of their own wealth are traitors, all of us, bit of a stretch!

thebman

swordofislam wrote: »

It is a great choice target those who benefited most from the tiger.

No it isn't, that doesn't even make sense. Those people invested in property not pensions.

And we have a massive pension time bomb coming down the road which this is not going to help.

swordofislam

If we are more concerned with the protection of our own wealth than the fate of our country then yes we are traitors. This me feinism has to go.

btard

Bards wrote: »

We've all lost income - but this is not income, it is savings. Savings that I will not be able to access for another 20+ years, yet the Govt has no problems accessing it today

I have to agree with you. My analogy is flawed on that point. I was listening to Eddie on newstalk and he pissed me off tbh. I agree with most of what he said about this. It's just that he's suddenly outraged because the government is plundering somebodys pocket. It's diabolical that they are plundering peoples savings and what they think they can get away with in general. If people stuck together they could put a stop to this robbery. They won't though. The private and public sector workers never stuck together. They were played against each other and it worked. Neither section stood up for the weakest members in society who were hit the hardest in real terms. Eddie least of all. We all get outraged and do something when it affects us personally. Eddie Hobbs is no different. This was the point I trying to make really.

beeftotheheels

thebman wrote: »

Yes however picking pensions is a particularly poor choice given we are going to have a massive shortfall in future and we are trying to get people who don't have one to start one.

The government is basically saying, you need to start a pension now give us .6% of it.

With PRSA's and the like, we will probably see pensions becoming mandatory in the next few years so it will be you have to contribute X amount to your pension and we are going to take .6% of that and at which point we will most likely see incentives to contribute axed as they will be mandatory.

Honestly looks like that is the way it is going to me

Do people not understand the level of the crisis we are currently in? If you were stone cold broke and looking like defaulting on your mortgage and getting turfed out on the street would you continue to save for the future, or would you raid your existing savings to pay off your mortgage and worry about tomorrow tomorrow.

That is where we are, we need to pay off the mortgage today to keep a roof over our heads, we need jobs, we need people getting back to work, getting off welfare, paying their mortgages.

If we get people back to work, if we get out of the recession then we can save for the future.

This is a small tax on the future to try and pay the bills of the present. Why is that so offensive to people??

Nermal

swordofislam wrote: »

If we are more concerned with the protection of our own wealth than the fate of our country then yes we are traitors. This me feinism has to go.

Some of us think the fate of the country depends on cutting spending, not banana-republic style asset seizing.

thebman

swordofislam wrote: »

If we are more concerned with the protection of our own wealth than the fate of our country then yes we are traitors. This me feinism has to go.

The country is its people. If the government attacks the welfare of the people then the government will find out it is not the country.

A dangerous road to go down for any government.

edit---

Cross posting newstalk interview with Ruari Quinn on this topic where he tries to defend going after peoples pensions.

Show is up here:
http://media.newstalk.ie/extra/2638/popup