This is a real issue with non-indexation. One of the bodies reporting on this before the recent change pointed out that the SFT needed to be closer to €3m today to match 2014 purchasing power. The raise to €2.8m by the end of the decade will therefore still be lower in real terms, given we expect inflation of around 2% per year.
However, every time the government goes to make a change it’s all “gold plated pensions” and “tax cuts for millionaires”, not to mind the work that often goes into building a pension pot.
I daresay they wouldn’t have touched the SFT at all but for the way it is impacting senior public sector appointments.
Life would go easier if this stuff was indexed, but then stealth tax rises would be a lot more difficult and on the side of other taxes politicians couldn’t parade the “cuts” they’re giving us each year, even if they’re essentially neutral compared to inflation.