Joan Burton (Dublin West, Labour)
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Question 288: To ask the Minister for Finance the percentage of a matured SSIA that is deducted in exit tax; if there are special arrangements for pensioners who are on low incomes that fall well below the tax bracket; if such persons have to pay the exit tax; and if he will make a statement on the matter. [9528/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The SSIA scheme was introduced in the 2001 Finance Act and gives a credit to all SSIA investors of 25%, or €1 for every €4 saved. The aim of the SSIA scheme was to encourage savings. This aim has been successfully achieved with over 1.1 million persons availing of the special scheme.

The exit tax on matured SSIA accounts is calculated at 23% of the gain or interest earned on the account over the 5 year period. For illustrative purposes, where a person has received interest on an SSIA account that amounts to 10% of their overall savings, the exit tax liable on the account at maturity would amount to around 2% of total funds in the account. In contrast, the Government top-up on SSIA accounts amounts to 25% of savings. In this respect, although all SSIA accounts are subject to an exit tax, it should be noted that the SSIA scheme represented a very good deal for all of those taking it up.

It is widely acknowledged that one of the reasons for the success of the SSIA scheme was its simplicity. It was clearly stated from the very outset that the SSIA investment returns would be subject to a 23% exit tax at maturity with no exemptions for anyone. I have no plans to change this.