Lack of across-the-board tax changes is unique

This year’s budget is unique with no changes taking place in the rates of income tax, PRSI, universal social charge, Vat, and capital taxes.

The only significant change is the rise in the Dirt rate and Exit tax to 41%. This rate appears very inequitable for those individuals whose marginal income tax rate is 20% and who are not in a position to claim a refund of Dirt ie those under 65.

An anticipated change, which had been flagged in Budget 2013, was the reduction in the standard fund threshold for pension funds from €2.3m to €2m. The fact that many in the public sector have attractive defined benefit schemes may have been a factor in the lower-than-expected reduction in the standard fund threshold. The pension levy will be reduced to 0.15% with effect from Jan 1, 2015, even though it will be increased from 0.6% to 0.75% for 2014.