“The economy has recovered all of the output lost during the crisis and is bigger than ever before in our history”, Noonan told lawmakers, Kenny and other Cabinet ministers. “We feel strongly that engineering will move much faster with a smaller and nimbler team”, he said.
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The governing coalition has indicated that there will be a modest giveaway of about 1.5bn euro (£1.1bn).
The threshold at which people pay USC will rise to €13,000, meaning an additional €500 to €1,000 per year extra for all earners.
The changes – which take effect from January 1 – will also see people earning up to €70,000 see their USC cut from a rate of 7% down to 5.5% in what is the headline initiative in Budget 2016. It also requires MNCs to report their number of employees, stated capital, retained earnings and tangible assets in each tax jurisdiction. The remaining 0.15 % pension fund levy will end this year and will not be applied in 2016.
Mr Noonan said the 9% Value-Added Tax rate for the tourism sector would not change despite the fact that the need for it is diminishing each year.
The local property tax will be frozen until at least 2019 Plans have also been announced today to extend free GP care to all children under 12, subject to negotiations with the Irish Medical Organisation. That will allow profits related to patents and software copyrights to be taxed at a rate of 6.25%.
Next year there will be pleading for a further cut in the CGT as “UK based entrepreneurs can enjoy a rate of 10% up to £10m and 28% on the excess”. “On housing, there was no announcement regarding rent controls; however, the Minister said that NAMA is now aiming to deliver 20,000 residential units by the end of 2020”.
Mr Noonan said the budget will “provide stability to families across the country”, rewarding work, enterprise and innovation. Among the sweeteners is free childcare for children from three years of age until they are five and a half, or until they start primary school.
The plan will be funded by a €13.2 billion allocation for health services next year.
However, there was no mention of any similar increase to the maximum €50 daily allowance on contactless payments as, after this amount is reached, contactless payments require a PIN to be entered.
The allocation for social housing is to be increased by 69m euros (£51.4m) to 414m euros (£308m). Spending increases were biased towards public sector pay rises of €300m and €220m of social spending increases.
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Shopkeepers say smugglers are “laughing all the way to the bank” at the 50 cent hike on a packet of cigarettes.
