The Coalition is under increased pressure to meet its budgetary targets for 2013 after the latest figures show the tax take for 2012 was behind expectations.
Finance Minister Michael Noonan will today unveil €3.5bn of cuts and tax hikes for 2013 — the sixth year of austerity.
It is expected to include:
* A property tax from Jul 2013 of up to 0.2% of the value of a home;
* A €10 cut to children’s allowance payments, with compensatory measures including childcare for less well-off families;
* Increases in motor taxes;
* A range of health cuts including a doubling of the 50c charge on prescriptions for medical card holders.
The Labour leadership last night tried to reassure backbenchers that the party’s only option was to pull through despite the difficult choices being made.
The party’s TDs, who met yesterday with Brendan Howlin, the public expenditure minister, were concerned about cuts to child benefit.
They also said they would have preferred a higher rate of universal social charge on those earning over €100,000 instead of the proposed “mansion tax” on properties worth more than €1m.
Labour leader Eamon Gilmore attempted to reassure the party’s support base, saying that while the budget would be “very tough” it would “put the end in sight” for austerity.
Labour TD Ann Phelan said she was “fearful” that the budget would be “very, very difficult” for the party but said “we have to keep driving forward, there is no way we can turn back”.
Róisín Shortall — who lost the party whip after resigning as junior minister — told the Taoiseach in the Dáil that the budget must be poverty-proofed.
Enda Kenny said it would be “challenging” but would be a “step forward” in dealing with the public finances and restoring job creation.
Exchequer figures released by the Department of Finance showed the budget deficit at the end of November was €12.97bn, compared with €21.4bn for the same period in 2011.
The tax take, which came in at €33.8bn for the first 11 months of the year, was €171m behind what was forecast, with a €267m shortfall for November.
Income tax came in €231m below profile, with most of the shortfall stemming from the self-employed sector, while corporation tax receipts were €21m below expectations.
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