Irish Government Plans Tax Breaks For Older Workers As Tax Take Shrinks

by Jason Gorringe, Tax-News.com, London

02 October 2001

The Irish government is planning to introduce proposals aimed at encouraging older workers back into the job market as the demography of the country shifts, but recent reports suggest that Finance Minister Charlie McCreevy is feeling the pinch as a result of a slump in revenue collection.

Labour Minister, Tom Kitt, said last week that one approach being considered by the government to encourage 'returners' is the introduction of an early or part time pension payment which would be exempt from additional tax, and would be linked to semi-retirement and part time work. According to the minister, such measures are necessary as over the next 20 years, a rapidly increasing proportion of the Irish population will fall into the 55+ age category.

Meanwhile, it was revealed that projects such as the development of the Campus Ireland sports stadium (dubbed by some as the 'Bertie Bowl'), road development schemes, and the overhaul of the health system, may be under threat as a result of a lower than expected tax take. Official figures released this week put the figure at least £1.3 billion lower than previous predictions.

Excise duties have slumped furthest over the past year due to a decrease in car sales, falling short of target by around 15%, and VAT collection is also reportedly well below expectations.

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