Seán Haughey (Dublin Bay North, Fianna Fail)
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171. To ask the Minister for Finance the reason a pension levy is imposed on certain pensions; the way in which the proceeds from this levy are spent; his plans to abolish this levy; and if he will make a statement on the matter. [24055/17]

Michael Noonan (Limerick City, Fine Gael)
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I take it the Deputy is referring to the stamp duty levies applying to the assets of funded pension arrangements introduced in 2011 to pay for the Jobs Initiative, the chargeable persons for which are the trustees of pension schemes and others responsible for the management of pension fund assets.

The stamp duty levy on pension schemes was introduced in the wake of the financial crash and at a time when the economy was in very serious difficulties. Something had to be done to preserve and boost jobs and it is an unavoidable fact that difficult economic situations require hard and very often unpopular decisions. All sectors of the economy had to contribute to the recovery plan and the levy was designed to claw back a small amount of the very generous tax reliefs that those contributing to pension arrangements had benefitted from over many years.

The original 0.6% stamp duty levy on pension fund assets ended in 2014. The additional levy of 0.15% which I introduced for 2014 and 2015, mainly to help continue to fund Jobs Initiative, also ended in 2015.

The position is that the equivalent value of all of the money raised from the stamp duty levy has been used to fund the wide range of measures introduced in the Jobs Initiative to protect existing jobs and to help create new jobs and the Initiative has been a success in this regard. The measures introduced include expenditure measures such as the JobBridge and Springboard schemes, as well as a number of tax and PRSI incentives such as the reduction in the VAT rate from 13.5% to 9% for the tourism and hospitality sectors and the temporary halving of the lower employer PRSI rate.

The value of the funds raised by way of the levy have been used to protect and create jobs and this has helped to create the improving financial and economic position of the State. Taxpayers to whom the impact of the levy may have been passed on by the chargeable persons responsible for the payment of the levy (the pension scheme trustees, etc.) will benefit from the changes which I began in Budget 2015 and which have continued in subsequent Budgets to reduce the tax burden on low and middle income earners.