In July, Ireland’s finance minister, Jack Chambers, promised €1.4 billion in tax measures and €6.9 billion in new spending. Recently, he revealed plans for personal tax cuts and cost-of-living support in a budget that aims to win votes before the upcoming election, which many believe could happen before Christmas.
Ireland is expected to have a budget surplus of €25 billion this year, largely thanks to a large tax payment from Apple.
Chambers mentioned that this surplus will be invested in infrastructure, such as housing, energy, water, and transportation. He emphasized that these investments are crucial for Ireland’s economy and will help attract foreign businesses【BBC】.
The budget includes €8.3 billion for tax cuts and spending increases, along with one-time cost-of-living assistance totaling €2.2 billion. Chambers predicts that Ireland’s economy will grow by 2.5% next year and 3% the year after【BBC】.
However, opposition party Sinn Féin criticized the government, calling them “serial wasters.” Their finance spokesperson, Pearse Doherty, argued that the budget doesn’t effectively address key issues like childcare, healthcare, and housing【BBC】. He pointed out that homeownership has dropped significantly for young people under the current government.
Despite the government’s plans, the Irish Fiscal Advisory Council has warned that increasing public spending by 7% could lead to economic overheating, exceeding the government’s own spending growth limit of 5%【BBC】.
Although inflation has decreased to below 2%, there are still signs of rising costs in certain sectors, particularly hospitality【BBC】.
Ireland’s economy has been strong since the pandemic, with employment at a record high and government finances benefiting from ongoing corporation tax revenue.
Still, Chambers acknowledges that the country’s infrastructure hasn’t kept up with this growth and requires significant investment.
Source: BBC.
https://www.bbc.com/news/articles/c77x6g8rxgjo