Lastest Budget 2011 Predictions
With Budget 2011 only a day away here are some of the latest predictions for what that budget might contain
Employee PRSI ceiling to be abolished, currently at €75,036
A lowering of personal income tax bands and credits or equivalent measures
A reduction in pension tax relief and pension related deductions
Car Scrappage scheme to be extended
Petrol and Diesel prices expected to rise
Cut in child benefit
Airport travel tax likely to be cut from €10 to €2
Government Ministers face pay cuts of upto €20,000
we will post full details of the actual budget changes after the Brian Lenihan announces them in the Dail tomorrow afternoon.
Budget 2011 details revealed in Recovery Package MOU
The Memorandum Of Understanding about the Recovery Package published yesterday seems to imply that there will be changes made to the revenue systems during 2011 (as opposed to at the start of the year). The document refers to a “yield €945m in 2011 and an extra €300m in a full year” when it discusses changes to personal tax bands and credits.
This would seem to indicate that the values will change after the first quarter of 2011 and that these changes will not be retrospective. In other words, we could have two (or more?) separate cumulative systems running during […]
EU agree €85 billion rescue package for Ireland
The EU has tonight agreed a €85 billion rescue package for Ireland, €10 billion of which will immediately be used to secure the banks. €17.5 billion of these funds are to come from the Irish pension reserve fund.the remainder being supplied by the EU and IMF at an average interest rate of 5.83%. Key points include
Ireland has been given an extra year, until 2015 to reduce the budget deficit to 3% of GDP required by the EU.
€15bn in Budget spending cuts and tax increases.
Restructuring of the main banks.
Banks must draw up a list of potential assets to dispose of. […]
€15bn Cuts and Taxes announced
Some of the taxation measures introduced in the four-year plan are as follows
Maintain the 12.5% corporation tax rate
PAYE threshold reduced by €3,000 to €15,300 by 2014
Net Pay by 2014 for a single person on €55,000 will be reduced by €1,860 per annum (€36 per week) or 4.8%. The net pay for a married on-income family on €55,000 will be reduced by €2,310 per annum (€44 per week) or 5.4%.
pension relief changes in the plan provides for the elimination of employee PRSI and Health Levy relief on pension contributions in 2011. It also commits, among other changes in 2011, to reducing […]
Budget 2011 will not be brought forward
Taoiseach Brian Cowen stated last night that the budget will not be held earlier than planned. The €15bn euro deficit reduction plan will be unveiled this afternoon. It has been reported in the irish press that included in the four-year plan will be
an increase in the marginal rate of tax to 42 per cent or higher
tax credits being reduced and tax bands being widened
a cut to the minimum wage from €8.65 an hour to €7.65
introduction of a “local services” charge
cuts to the social welfare budget of €2.5bn over the four years
Ireland asks for EU/IMF bailout
Taoiseach Brian Cowen has announced that the EU has agreed to a joint EU/IMF bailout details of which will be negotiated in the coming weeks. The package will be over three years and is linked to restructuring of the Irish banking sector and a deficit reduction plan. Brian Cowen also stated that income tax levels will be returned to 2006 levels.
Government may accept EU funding
Today Minister for Finance Brian Lenihan said the Government may accept EU funding for the banks after talks in Dublin with the European Union and International Monetary Fund.
The Government however is also expected to battle to prevent any increase in the €6 billion adjustment proposed for the 2011 budget and the €15 billion target in the four-year plan.
Parking Levy Awaiting Implementation
Recently I have been queried a number of times regarding when the parking levy will start. The current situation is that the minister has signed the parking levy into force so it can go live at any time, but it is still awaiting implementation because there are issues in defining the designated areas. Watch this space ….
Four-year budget plan to be announced next week
Minister for Justice Dermot Ahern said yesterday that the government would publish it’s four-year budget plan early next week. This plan will contain the outline of the proposed budget cuts totalling €15bn over the next four years, budget 2011 will contain the largest single adjustment of €6bn.
It’s official Budget adjustments of €6bn
The Government announced today it plans to take measures totalling €6bn in December’s Budget. Finance Minister Brian Lenihan has stated that €4.5bn of the €6bn will be in the form of expenditure cuts, the remaining €1.5bn will be in the form of increased taxes. However the details of these measures, of most interest from a payroll point of view will have to wait until budget day, so watch this space!