The Republic’s finance minister Michael Noonan is sticking with his predecessors’ tradition of presenting user-friendly budgets prior to a general election.
With voters set to go to the polls by April, endless leaks in recent days had already indicated that the Fine Gael/Labour coalition was keen to lure the undecided vote with the first semi-giveaway budget since before the 2008 economic crash.
There were early reports that Mr Noonan was planning €1.5 billion in tax cuts and spending hikes, providing a boost for families, the elderly and the middle-income earners that had been hit hard in eight successive austerity budgets.
Heading into this morning’s Cabinet meeting, Taoiseach Enda Kenny told assembled reporters that Budget 2016 would provide “relief” for householders earning up to €70,000.
Moves to reduce the tax burden on the squeezed middle-income families will include cuts to the controversial Universal Social Charge (USC), which will now come into play after €13,000 is earned rather than €12,012.
The state’s minimum wage is also set to increase by 50 cent while the Christmas bonus for those on social welfare payments will be restored to 75 per cent of its rate prior to its 2009 abolition.
Elderly people on state pensions will receive an additional €3 a week while the fuel allowance will rise by €2.50.
Other measures likely to be welcomed will include tax credits for the self-employed, a reduction in capital gains tax and an increase in the inheritance tax exemption threshold.
Old favourites have not escaped the minister’s attention with smokers facing a 50 cent hike in the the price of a 20-pack of cigarettes.
