independent

Thursday 17 April 2014

Noonan gambles with new tax rises

Finance Minister Michael Noonan is gambling on economic recovery as he revealed a series of taxes which will hit all aspects of Irish daily life

The Government has taken a gamble on economic recovery after unleashing a slew of indirect taxes hitting every aspect of daily life.

With vulnerable families and the disabled reeling from multimillion euro benefit cuts, shoppers, motorists, savers and investors were hurled into the firing line of tax hikes.

Finance Minister Michael Noonan claimed the one billion euro revenue raising package would penalise the wealthy while 330,000 part-time workers were spared the Universal Social Charge.

But critics attacked the austerity measures - the second half of a two day budget to save 3.8 billion euro - claiming the Government could not tax its way out of the economic mess.

Major reforms included an expected 2% VAT hike, a savage 60% motor tax increase for the greenest vehicles and new levies for any employees holding property or share investments.

The fallout was immediate as the Government suffered the loss of its fourth backbencher in the last weeks and newly elected Labour TD Patrick Nulty refused to support the budget.

One of the most significant reforms was to ease the burden on the lowest paid. New thresholds for the Universal Social Charge - a levy on virtually all income - will free part-time workers earning less than 10,000 from the levy and leave them four euro a week better off. But the pain is being felt most in large families as they count up the impact of child benefit cuts followed by a four cent rise in petrol and diesel from January 1 and a 100 euro property tax.

Motorists have also been punished after answering pleas to go green with tax on the lowest-emission cars up about 60% - Band A up to 160 euro, Band B up to 225 euro, and Band C up to 330 euro.

The old reliables were hit by 25 cent on cigarettes and the 2% VAT rise on alcohol as well as looming reforms on supermarkets selling below cost. The carbon tax will also hit drivers from midnight on Wednesday - petrol up 1.4 cent a litre and diesel 1.6 cent and while households using coal and peat were saved, 1,000L of home heating oil will go up next May by 14.40 euro.

Several initiatives were announced to target wealth - a new levy under Pay Related Social Insurance for workers who have a rental income or stocks and shares; increases in capital gains and acquisitions taxes by 5%; and a 30% Deposit Interest Retention Tax.

Press Association

Also in this Section

Classifieds

CarsIreland

Independent Shopping.ie

Meet, chat and connect with
singles in your area

Independent Shopping.ie

Meet Singles Now

Findajob

Apps

Now available on

Top Stories

Most Read

Independent Gallery

Your photos

Send us your weather photos promo

Celebrity News