The Minister for Finance published the Finance (No. 2) Bill 2011 on May 19th 2011 which gives effect to the taxation measures announced in the Jobs Initiative on May 10th.
Main Provisions of the Bill:
1. Introduction of annual pension fund levy.
2. Reduction in VAT rates for goods and services such as restaurants, catering and accommodation.
3. Jobs initiatives.
1. Annual Pension Fund Levy:
Employment initiatives to be financed through the imposition of an annual levy at a rate of .06% on pension funds. This levy is to remain in place for four years. The levy will apply to:
The levy will not apply to approved retirement funds (ARF).
2. Reduction in VAT rates:
A 9% rate of VAT will apply to the following:
3. Jobs Initiative
A reduced rate of employer’s PRSI of 4.25% will apply to earnings of less than €356 per week with effect from the 1st July, 2011. The existing PRSI exemption for an unemployed person is to continue until the end of the year.
Please contact Maura Duffy, Partner for further information.