Image via WikipediaA SHARP increase in taxation, deep cuts in social welfare payments, a reduction in the minimum wage and a modest property tax are among the elements in the Government’s four-year National Recovery Plan.
Tax relief on pensions will be reduced dramatically and recipients of public sector pensions will face cuts for the first time.
The 140-page plan published yesterday outlines a package of measures designed to reduce public spending by €10 billion and raise an extra €5 billion in taxes by 2014.
The plan will be front-loaded with a €6 billion adjustment coming in the 2011 budget, to be published on December 7th. That will involve extra tax of about €2 billion in a full year and cuts in social welfare of €760 million.
The Government’s prospects of getting the budget through the Dáil eased last night when it emerged that Independent TDs Jackie Healy-Rae and Michael Lowry are likely to support it.
With the backing of the two Independents the Government would have a potential 82 supporters while the Opposition will have a potential maximum of 80 if Pearse Doherty is elected as Sinn Féin TD for Donegal South West tomorrow.
EU economic and monetary affairs commissioner Olli Rehn welcomed the plan – which maintains corporation tax at 12.5 per cent – saying it represented “an important contribution to the stabilisation of Irish public finances”.
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