ESRI: Budget must not contain tax cuts

There should be no tax cuts in October’s budget even though more than 50,000 jobs are set to be created this year and the domestic economy will grow at a rate not seen since the days of the Celtic Tiger, according to the ESRI.

“We are now approaching the end of austerity,” said the ESRI’s chief economist, John FitzGerald.

In its latest quarterly economic review of the economy, it forecasts GNP growth of 3.5% this year and 3.7% next year. It also predicts the unemployment rate will drop to 10% by the end of 2015 and the fiscal deficit will fall to 2.8% over the same timeframe. This means that Government is on track to meet the 3% fiscal deficit target by the end of 2015 as agreed with the troika.