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Tax relief and partnership pensions

Agulnik, Philip and Le Grand, Julian (1998) Tax relief and partnership pensions. 5. Centre for Analysis of Social Exclusion, London School of Economics and Political Science, London, UK.

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Abstract

Government support of private (occupational and personal) pensions through the system of tax reliefs is large: between one quarter and one third that of direct support of state pensions through public expenditure. However, it is regressive, lacks transparency and is difficult to control. This paper argues that it should be replaced by a cost-neutral matching grant or tax-credit scheme. Such a scheme would embody the ‘partnership’ idea implicit in much government policy in this area, but would be much more progressive, more open, and more accountable than existing arrangements. The argument is illustrated by statistical comparisons of the distributional impact of the present system and three alternative versions of the tax-credit scheme. An appendix discusses the methodology for calculating the cost of pension tax reliefs over time.

Item Type: Monograph (Discussion Paper)
Official URL: http://sticerd.lse.ac.uk/case
Additional Information: © 1998 the authors
Library of Congress subject classification: H Social Sciences > HJ Public Finance
Sets: Departments > Social Policy
Research centres and groups > LSE Health
Collections > Economists Online
Research centres and groups > Centre for Analysis of Social Exclusion (CASE)
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: 5
Date Deposited: 06 May 2008 14:16
URL: http://eprints.lse.ac.uk/4652/

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