Over recent years, many individuals and reports have raised the issue of the equity of the current tax relief arrangements given the significant Exchequer costs involved and the fact that the reliefs are skewed significantly towards those on higher incomes. Apart from helping to meet the challenging budgetary circumstances we are now facing, the decision to reduce the earnings limit should also be taken as a signal of the Government's intent to move towards more equitable tax arrangements generally for private pension provision in the context of the development of the long-term policy framework for the pensions.

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