Thinktank urges increase in taxes

A new economic thinktank has urged the Government to stop cutting public spending and increase taxes in a bid to revive the economy.

In its second quarterly economic bulletin, the Nevin Economic Research Institute (Neri) said that current budget deficit targets were too heavily reliant on economic recovery and that continuous expenditure cuts would only result in a much reduced public service.

It is calling for a medium-term policy shift towards maintaining public spending and increasing tax revenues via a widening of the tax take. The institute suggests there is still ample scope to raise the tax take without extra hurt to average-income households.