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15/10/2008
Disposable Income Cuts Threatens 'Depression'
The Opposition has said Tuesday's Budget has put the current recession at risk of becoming a "depression" after it slashed disposable income across the board.
The Finance Minister, Brian Lenihan, announced a 1% across the board tax levy, which when added to a 0% increase tax credits, is thought to slash take-home pay by up €290 in a year for the average worker.
Some analysts are arguing that in a Budget supposed to reinvigorate the economy will be slashing consumption, pressurising commerce, and fuelling unemployment as workers also try to wrestle with a cut in the tax relief on mortgages for non first-time buyer, a hike in VAT rates, an eight cent duty on petrol and higher motor tax, increased excise duty on cigarettes and wine, a cut in what he can be reclaimed on medical costs, and new travel tax and hikes in hospital charges.
In a somewhat ironic move, the risk-taking public have also been given a slap on the wrists, unlike the bailed-out 'foolhardy' banks, with an increase in betting tax from 1% to 2%.
Mr Lenihan also announced a reduction in the allocation for the Horse and Greyhound Racing Fund.
Fine Gael TD Richard Bruton said the cutbacks in vital infrastructure programmes threaten to turn the current Irish recession into a sustained depression.
"As a result of the Budget, taxes are way up, borrowing is heading up, spending is continuing to go up while levels of social services and capital spending are down. With more announcements due in the coming days there are undoubtedly more shocks to come," he said.
In the Budget, Mr Lenihan also revealed the expected wage-cut for Cabinet ministers of 10%.
However, it has since been revealed by an Irish newspaper that the wage cut will not affect their pension schemes, which will still receive the full contribution at normal pay.
(DW)
The Finance Minister, Brian Lenihan, announced a 1% across the board tax levy, which when added to a 0% increase tax credits, is thought to slash take-home pay by up €290 in a year for the average worker.
Some analysts are arguing that in a Budget supposed to reinvigorate the economy will be slashing consumption, pressurising commerce, and fuelling unemployment as workers also try to wrestle with a cut in the tax relief on mortgages for non first-time buyer, a hike in VAT rates, an eight cent duty on petrol and higher motor tax, increased excise duty on cigarettes and wine, a cut in what he can be reclaimed on medical costs, and new travel tax and hikes in hospital charges.
In a somewhat ironic move, the risk-taking public have also been given a slap on the wrists, unlike the bailed-out 'foolhardy' banks, with an increase in betting tax from 1% to 2%.
Mr Lenihan also announced a reduction in the allocation for the Horse and Greyhound Racing Fund.
Fine Gael TD Richard Bruton said the cutbacks in vital infrastructure programmes threaten to turn the current Irish recession into a sustained depression.
"As a result of the Budget, taxes are way up, borrowing is heading up, spending is continuing to go up while levels of social services and capital spending are down. With more announcements due in the coming days there are undoubtedly more shocks to come," he said.
In the Budget, Mr Lenihan also revealed the expected wage-cut for Cabinet ministers of 10%.
However, it has since been revealed by an Irish newspaper that the wage cut will not affect their pension schemes, which will still receive the full contribution at normal pay.
(DW)
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No Tax Break In Budget?
The author of next month's long-awaited 2008 Budget won't give much away - literally. Although the details are still under wraps, Minister for Finance Brian Cowen has all but ruled out tax cuts due to 'the current economic climate'. In a speech earlier this week, Mr Cowen signalled that he will announce around €2.
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The Minister for Finance has said "we are living beyond our means", and has called for the Irish people to lower expectations of their standard of living.
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