Brian Cowen (Laois-Offaly, Fianna Fail)

The latest figures published in the 2003 annual report of the Revenue Commissioners indicate that in the short tax year, April to December 2001, the cost of tax relief on pension contributions was tentatively estimated at approximately €2 billion. It is not possible at present to examine the take up of the tax relief for all pension contributions across different income categories. This is because the relevant information is not available to the Revenue Commissioners as the tax relief for pension contributions for employees is normally given at source, that is, the taxable income is the income net of pension contributions by employees.

However, data are available in respect of the tax relief for contributions to retirement annuity contracts, RACs, across different income categories. Retirement annuity contracts are used by the self-employed and by employees who are not in pensionable employment. It is intended to examine these data in the context of the review of pension reliefs which forms part of the review of tax reliefs for high earners.

There are a number of tax measures to make provision for old age. These include capital allowances in respect of nursing homes and housing for the aged and infirm, relief for health expenses which includes relief for approved nursing home fees, a carer's allowance and a home carer's tax credit as well as tax relief for payments to over 65 year olds under deeds of covenant. These provisions clearly indicate that the Government continues to have the best interests and long-term care of the elderly in our society at the top of its agenda.

Regarding the maturity of SSIAs, the use to which the SSIA moneys are put is ultimately a matter for the individual account holder. Any suggestion for further incentives by way of tax concessions to facilitate further savings on pension contributions will have to be judged in the overall context of Government priorities and resource constraints.

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