Eoghan Murphy (Dublin South East, Fine Gael)
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Question 66: To ask the Minister for Finance his views on a proposal (details supplied) along with the proposed pension levy on pension funds. [14039/11]

Michael Noonan (Limerick City, Fine Gael)
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I assume that what is being proposed in the details supplied with the Deputy's question is that the amount of the pension levy passed on to individuals over the period of the levy should be available to them as a credit against future income tax liabilities. The moneys to be raised from the pension fund levy will be used to pay for the reductions in VAT, PRSI and the air travel tax as well as for the additional expenditure measures announced in the Jobs Initiative last month. These and the other various measures in the Initiative represent the first steps by this Government towards improving the competitiveness of important sectors of the economy and facilitating the return to work of people currently unemployed.

Given our commitments under the Joint EU/IMF Programme of Financial Support and the current difficulties in the public finances, the Jobs Initiative must be funded on a cost neutral basis. Since the proceeds of the levy are already committed in the manner I've described, a commitment to allow the levy to also be used as a tax credit against future tax liabilities would mean that the Jobs Initiative would not be cost neutral. I cannot therefore agree to the proposal.