The Irish Government seems intent on shaking as much money as it possibly can out of the savings accounts held within Irish banks. And for those that invested in a private pension, Government is having a good old nibble there too!
The Government announced yesterday that it will charge a whopping 41% tax on interest earned on savings accounts. So, for those already underwhelmed by measly interest rates paid by banks, the picture just got a whole lot worse. Think of it this way, if you see a bank paying X%, THINK HALF because that is what you’ll earn after the Government takes its slice of YOUR money.
On private pensions, Government has been busy here also. What is happening is more like a slow waltz; two steps forward and one step back. Government ‘gives’ a fraction and then grabs a lot from private pension accounts. This raid on private pension accounts has been happening for a number of years and is about to get a whole lot worse (this does not impact Government officials or civil servants).
It’s a big pity. There really is a looming pensions problem. More people are living longer and fewer people are being born and for pensions to continue working, you really do need a lot more of the latter. What a shame that this Government (and the last one too!) would turn the private pension funds of hard-working citizens into emergency slush funds for the state.