BUDGET 2016: Coalition to reveal €1.5bn budget

The opposition has accused the Government of returning to pre-election “Bertie-nomics” and of thinking the recovery can “run before it can walk”.

 

The claims were made as the Coalition prepares to launch a budget made up of €1.5bn in tax cuts and benefits hikes and containing something for all sections of society.

Fianna Fáil, Renua Ireland, and People Before Profit lashed out at plans for a string of potentially vote-winning measures as Finance Minister Michael Noonan prepares to reveal the budget at 2.15pm today.

Widely leaked Government plans show the €1.5bn budget — which increases to €3bn when this year’s health, transport, and education supplementary budgets are taken into account — will contain €720m worth of tax cuts and financial packages to benefit the poor, the rich, the elderly, families, and the squeezed middle.

The changes are being used to underline the perception of a wide-ranging recovery and that the Coalition has helped Ireland weather the economic storm.

They include:

  • €720m of tax cuts, including the reduction in the highest rate of tax below 50%;
  • USC rate changes to take tens of thousands of the lowest-paid out of the system altogether and cut the 7%, 3.5%, and 1.5% rates for others to 5.5%, 3%, and 1%, respectively;
  • A new three-year tax credit scheme for farmers and the self-employed which means €500 of their money each year cannot be touched by Revenue. This change, which will mirror the exist tax credits system for PAYE workers, will be worth €1,600 over three years;
  • The return of the €1,700-a-year respite grant to carers;
  • An inheritance tax starting point increase which means €300,000 of gifts to children — up from the current €225,000 — cannot be taxed;
  • The phasing out of the private pensions levy;
  • A minimum wage increase plan worth €1,000 to low- income workers;
  • The 75% return of the Christmas bonus;
  • Increased household allowances for older people;
  • A second free pre-school year;
  • Split paternity leave;
  • Further changes, it is claimed, will leave people earning €38,000 a year €320 better off and those on €70,000 a year €800 better off.

Mr Noonan will tell the Dáil today that “the top priority of this year’s budget is to keep the recovery going, while providing relief and better services for the Irish people”.

Renua Ireland leader Lucinda Creighton said the “entire” budget appears to be a return to “Bertie-nomics” and proof the Coalition believes the economic recovery can “run before it can walk”.

Fianna Fáil finance spokesman Michael McGrath said that after years of cuts — including those introduced by his own party before it was voted out — older people in particular will not be “fooled by the partial return of the Christmas bonus”.

People before Profit TD Richard Boyd Barrett said it is “insulting” the Government is talking about a recovery “when the reality for huge numbers in this country is that they are struggling to keep roofs over their heads”.

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