Saturday 23 September 2017

Colm McCarthy: Great expectations of income tax cuts and wage rises are ill-founded

A real good news story will be when we have a balanced budget, not further borrowing, writes Colm McCarthy

WHEN THE BUBBLE BURST: Christmas shoppers in Grafton Street in 2008. The levels of public spending reached that year, the year of the bank guarantee, were financed to a substantial degree out of tax revenues that were artificial and temporary. Photo: Niall Carson
WHEN THE BUBBLE BURST: Christmas shoppers in Grafton Street in 2008. The levels of public spending reached that year, the year of the bank guarantee, were financed to a substantial degree out of tax revenues that were artificial and temporary. Photo: Niall Carson
Colm McCarthy

Colm McCarthy

New taxes, sharp increases in existing taxes and deep expenditure cuts under numerous headings have been imposed since the extent of Ireland's budget crisis struck home back in the second half of 2008.

Despite all of this effort government spending out-paced government revenue by almost €1bn per month during 2013. In the coming year the Government will add a further €8bn to the debt mountain according to last October's Budget.

The State debt already exceeds €100,000 per employed person. Not until 2018 is a balanced budget envisaged in the recent medium-term government plan, and the debt will keep increasing until balance is achieved.

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