The Government only needs to make a €200m adjustment rather than a €2bn one in October’s budget, the country’s leading employers’ representative has claimed.
Ibec also predicts the economy has the potential to grow by 3%-4% per annum over the next decade.
In its pre-budget submission, published today, Ibec has said an overly prudent approach would risk missing the opportunity to inject real growth into the economy. It added that Budget 2015 can be the first growth-enhancing one for almost a decade.
Come October 14, Ibec wants Finance Minister Michael Noonan to follow through on promises to:
- Drop the pensions levy;
- Increase the entry point to the marginal tax rate from €32,800 to €34,800;
- Reduce the marginal tax rate from 52% to 51%;
- Reform universal social charge;
- Reverse alcohol excise increases;
- Maintain the 9% Vat rate for the hospitality sector.
Ibec also wants €300m worth of income tax reductions and a €100m reduction in consumer taxes.
It said an overall adjustment of €200m would be enough to reduce the budget deficit to 2.7% of GDP by the end of 2015, which would be marginally ahead of the 2.9% target. This year’s 4.8% target will be comfortably beaten, it said.
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