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Tax cuts won't arrive until 2015 at earliest

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 Finance Minister Michael Noonan. Photo: Reuters

Finance Minister Michael Noonan. Photo: Reuters

Finance Minister Michael Noonan. Photo: Reuters

ON the day the country exits the IMF bailout the Government has indicated that income tax cuts are coming - but not for another year at least.

Finance Minister Michael Noonan and Transport Minister Leo Varadkar have indicated the cuts could be on the way for the budgets planned for either 2015 or 2016.

Mr Varadkar told the Herald those who would benefit most would be middle income earners.

"Its early days to be talking about the budget for next year and the budget for next year could still be a difficult budget, there are still some further adjustments to make. But there are lots of moving parts," Mr Varadkar told the Herald.

 

GROWTH

"It will depend on growth in the economy and will depend on a number of other factors but it is definitely the view of the government that if not in the budget for 2015, then certainly in the one for 2016 we do want to give something back.

"People have made enormous sacrifices over the last six years to help the country get out of the bailout in the way it has this weekend," he said.

"One of the features of our taxation system, which relatively speaking has income taxes a little bit lower than most other countries and has a progressive taxation system in that the best off pay the most by a mile," Mr Varadkar added.

 

BILLIONS

He said the current tax system was "unfair" on middle income earners, who are having to pay the highest tax rate, something he described as unusual in European countries.

Communications Minister Pat Rabbitte said there is a strong "moral'' argument for help in reducing our billions of euro debt mountain.

He conceded the amount of money we owe remains "challengingly high" and insisted Europe should provide us with a break.

"Gradually, we clawed our way back from the brink," he said. "We're now in circumstances where the challenge is to build on that stability, create jobs and put people back to work.

"It's not like you can click your fingers and it will happen overnight," Mr Rabbitte said.

And he dismissed suggestions Ireland could have been more pushy with EU chiefs when battling to ease the country's austerity burden.

Instead, progress was made through patient diplomacy behind closed doors.

He said the end of the bailout has given people a psychological boost and an "injection of confidence".

"There is a psychological advantage from being back in control of our own economic destiny. We're not out of the woods by any means," he said.

"We live in a very uncertain world. A lot does depend on growth – but it is a big psychological milestone for the country,'' Mr Rabbitte stressed.

Read Andrew Lynch, page 16


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