Govt criticised over backdated pay levy

Updated: 22:18, Thursday, 16 April 2009

Fine Gael has criticised what it has described as the Government's redundancy rip off.

1 of 1Richard Bruton - Described Govt measures as 'scandalous'
Richard Bruton - Described Govt measures as 'scandalous'

Its finance spokesman Richard Bruton said thousands of newly redundant workers faced the grim prospect of having the new income levy backdated.

In the Budget last week the 1%, 2% and 3% income levies were doubled and the thresholds lowered.

The move was widely anticipated and many accountants advised clients to pay themselves lump sums before the Budget.

To head off that tax avoidance, the Government is including a composite structure for the levy.

That will ensure people who can manipulate their own income are captured by the new levy.

However, it will mean some people receiving redundancy payments who are liable for income tax will be hit by the new levy.

Today Richard Bruton described that as 'scandalous'.

However, the Government has indicated the issue of taxing redundancy payments may now be examined in the Finance Bill.

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