Irish Budget bites deep

Press, 11 February 1983, Page 6

Irish Budget bites deep

NZPA-Reuter Dublin The Irish Government, saddled with a £l(lrish) billion ($2.42 billion) current spending deficit and heavy foreign debts, has introduced the severe Budget it promised, hitting all but the lowest-paid. The Finance Minister, Mr Alan Dukes, yesterday announced a deficit of £897 million ($1.72 billion) on revenue of £5.75 billion ($11.03 billion) for 1983. With an inherited deficit of just over £1.2 billion ($2.24 billion), Mr Dukes had to find

around £3OO million ($672 million) in extra revenue, and he cast his net wide. The biggest single haul will come from a biting increase in value-added tax (sales tax), which went up from 18 to 23 per cent at the basic rate, and from 30 to 35 per cent at the top rate for luxury items. But the Budget also hit holiday-makers with a rise in foreign travel tax; drivers with rises in car tax, and home-owners by lowering the threshold on tax relief for mortgages.

Economic analysts estimated that the measures would take around 3 per cent of gross national product out of the economy, which signified more unemployment in a country with a record 14.5 per cent out of work already, and lower living standards for all. While the Budget was sharply criticised by the Opposition, the comfortable sixvote majority of Dr Garret Fitz Gerald’s fine GaelLabour coalition, which won power in December, ensured its passage.

While hitting the wealthy with a tax on property over a certain value, and helping out the poor by raising the minimum taxable income, the main burden fell on the ordinary taxpayer, through a temporary 1 per cent levy, and on the consumer. The Opposition Leader, Mr Charles Haughey, said that the Budget would “rock the economy to. its foundations.” Describing it as repressive and inflationary, he said: “It is a book-keeper's budget, as cold and impersonal as a computer printout.”