Paschal Donohoe to cut tax despite warnings

Finance Minister Paschal Donohoe has said he still intends to cut taxes for middle-income earners despite warnings from economic bodies about the economy overheating.

He said Ireland remains in a strange position where someone earning the average wage remains on the higher rate of tax. He committed to continuing to tackle that anomaly, but only on a sustainable basis.

Announcing his summer economic statement, he revealed he is to forgo spending €900m in the upcoming budget allowed for under the EU fiscal rules. To spend that, he said, would be inappropriate given how strong the economy is growing.