I propose to take Questions Nos. 52 and 53 together.
An annual stamp duty levy of 0.6% applies in each of the four years from 2011 to 2014, to the market value on the valuation date (generally 30 June each year) of assets under management in pension funds and pension plans approved under Irish tax legislation. I am advised by the Revenue Commissioners that this includes occupational pension schemes, Retirement Annuity Contracts, Personal Retirement Savings Accounts and Personal Retirement Bonds. The levy applies to pension fund assets regardless of whether they relate to active or deferred members of schemes, and to the extent that pensions in payment are being paid directly from a defined benefit pension scheme the assets backing those pensions also come within the levy charge.
The 0.6% levy was introduced to fund the Jobs Initiative and will be abolished from the 31st of December 2014. I indicated in my recent Budget speech, however, that I would be introducing an additional levy on pension funds, within the existing legal framework, at 0.15% in 2014 and 2015 to continue to help fund the Jobs Initiative and to make provision for potential State liabilities which may emerge from pre-existing or future pension fund difficulties.
I am further advised by the Commissioners that the levy is not imposed on individual pension scheme members whether active, deferred or retired. Rather the chargeable persons for the levy are the trustees or other persons (including insurance companies) with responsibility for the management of the assets of the pension schemes or plans. The payment of the levy is, however, treated as a necessary expense of a pension scheme and the trustees or insurer, as appropriate, are entitled, where they decide to do so, to adjust current or prospective benefits payable under a scheme to take account of the levy. It is up to the trustees to decide whether and how the levy should be passed on and who should be impacted and to what extent, given the particular circumstances of the pension schemes for which they are responsible.
There are very few exemptions from the levy and this, in part, explains why it was possible to introduce it at a relatively low rate of 0.6% in the first place and to keep the rate of the additional levy as low as 0.15%. Narrowing the base of the levy would inevitably result in a greater imposition on the non-exempt schemes and I am not prepared to consider such a change.