Changing marginal rate tax relief on pensions ‘detrimental’ to savings

Any change to the marginal rate tax relief in next month’s budget would be hugely detrimental to attempts to encourage people to save for retirement as it would introduce a disincentive to save, according to one leading body.

In its pre-budget submission published yesterday, industry representative the Irish Association of Pension Funds (IAPF) urged the Government to bring stability to the pensions sector and keep the motivation of saving for one’s retirement core to any decisions it makes.

The IAPF said that last year’s budgetary statement — saying that tax relief on pension contributions would remain at the marginal rate and the pensions levy wouldn’tbe renewed after 2014 — have been key incentives for pension savers.