IMF urges Government not to cut taxes in future Budgets

The International Monetary Fund (IMF) has urged the Government not to cut taxes in future Budgets.

In a report, it says the tax base should be broadened to protect the economy from future shocks recommends fiscal policy be tightened up.

The IMF proposes a number of changes to do that, such as scrapping the 9% VAT rate for the hospitality sector in broadening the tax base.

It also recommends increasing the excise tax on diesel and a gradual increase of the property tax to take into account new valuations.

The IMF report notes the economy is vulnerable to a number of risks including Brexit and changes in tax policy in the US that may pull some international investment away from Ireland.

Taking this into account, it has advised Minister for Finance Paschal Donohoe to build up some buffers by tightening things up, and not spending or cutting taxes wildly in the budget.

- Digital Desk

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