Budget Day - How empty is the cupboard?

mike65

The shortfall in the current account is going to be about 1.7 billion, the states GDI is about 160 billion so its not that big a deal.

Trouble is, while the government could easily make the case for a spot of intelligent borrowing, its got the perfect chance to scare us in a mild way, into accepting a relative hairshirt budget as being a pragmatic necessity. So I'm expecting a freeze in tax-bands, proberly a modest hike in the reliables esp fuel. Little change beyond inflation adjustment for dole, pensions, child allowence etc.

It won't matter if the budget is seen as harsh as by the next election it'll have been forgotten and the public finances will almost certainly be in better shape anyway.

Mike.

jmayo

mike65 wrote: »

The shortfall in the current account is going to be about 1.7 billion, the states GDI is about 160 billion so its not that big a deal.
....
It won't matter if the budget is seen as harsh as by the next election it'll have been forgotten and the public finances will almost certainly be in better shape anyway.

Mike.

Why do you believe that the public finances will be in better shape by the next election ?
Do you see residential construction and house prices going back up to the crazy levels of a year ago, thus meaning the tax contribution from construction and housing will be back up to last years level ?
Do you see an influx of new industries to take advantage of our increasing competiveness :rolleyes:
Or maybe the public service/sector will take a tax cut and redundancies to make it's budgetary cost less?
I can't see any of the above happening.
Actually I see the reverse happening so that the public finances will be in even worse state by next election. The tax take from construction and housing will drop even more, the public sector with all their benchmarking demands will take an even bigger chunk of the public finances and we will lose even more industry over the coming years.

But then again I am just a moaning cynic according to Bertie :rolleyes:

mox54

Our current administration are a bunch of amateurs run by senior civil servants and industry fat cats!!, they have wasted an onscene amount of money and made poor investments all over the place....ask yourself...why wasn't the red cow done up the way it is now at the start!!, because they're idiots and amateurs and who cares anyway, the money is there to throw around and make mistakes!, not anymore and come 4 pm we'll all be a little poorer because of their !!!!!!!!.

The hard times are on the way and watch the Government fall flat on it's face, HOPEFULLY!!.

Colonel Sanders

Will more tax really be levied on fuel? Increasing oil prices have already pushed prices up at the pumps, such a move would be incredibly unpopular. However as already stated the next election is a long way away and Irish people seem to have political memories of tadpoles.

The price of cigarettes will surely increase and maybe alcohol too (altho with vintners whining about falling levels of business will the publican party really want this)

sovtek

Colonel Sanders wrote: »

Will more tax really be levied on fuel? Increasing oil prices have already pushed prices up at the pumps, such a move would be incredibly unpopular.

Like pay hikes for the political elite, tax on credit cards/ATM's, Bin tax, tax on immigrants (ok well we can't vote until we get citizenship but the latter are growing in numbers and may not have such a short memory) etc etc.

However as already stated the next election is a long way away and Irish people seem to have political memories of tadpoles.

You have a point although the last election was during the "good times". What's puzzles me is that everyone (broad stroke I admit) seems to think that civic participation seems to stop at voting every several years. There are ways to influence government outside of an election (although its limited). If people start taking to the streets things might be a little different. What's wrong with a little chaos every once in a while.
I'm struck by the severe difference in the standard of living on the Continent and how their governments seem to be scared of the people...the total opposite of here. The Germans and the French go mad at the slightest suggestion of corruption amongst the politicians.

The price of cigarettes will surely increase and maybe alcohol too (altho with vintners whining about falling levels of business will the publican party really want this)

Yeah and all the publicans will just raise their prices to keep the %100+ profit margin on drink and cigs.

seamus

Watch the lower band tax rate go up 1%. They'll tax the worker on the street no bother, but when it comes to the higher-band white-collar worker (i.e. the voter), they won't dare go back on their promise. That should bring at least half a billion back into the coffers.

Cigs, Alcohol and petrol will go up, that's a given.

Mortgage interest relief will go up as they attempt to interfere in the plummetting property market, however the stamp duty bands will change to try offset this - the bands'll move upwards, but so will the rates. This will be a vain attempt to convince people to buy new homes (bailing the property developers out of it).

VRT won't move. It's a cash cow for the Government and the volume of new cars being bought is still high. If new car sales drop and second hand sales go up, then they may begin to drop VRT rates.

There may be a drop in corporation tax to try increase our competitiveness.

mike65

Seamus the VRT is going to be calulated on a new "green" basis so there will be changes (unless Biffo chooses not to announce anything today). Income tax rates won't change, they just won't widen the standard rate band so people will get taxed at 41% rate a bit quicker. Tax credits will go up a bit.

Don't see any change on stamp-duty.

Mike.

Hitchhiker's Guide to...

seamus wrote: »

Watch the lower band tax rate go up 1%. They'll tax the worker on the street no bother, but when it comes to the higher-band white-collar worker (i.e. the voter), they won't dare go back on their promise. That should bring at least half a billion back into the coffers.

lol - no way the lower rate tax will go up

kluivert

Is there a specfic budget forum or will this be the trend. Am actually looking forward to the Budget this year, so I can tell everyone I told you so.

Fianna Fail - a bunch of crooks.

Its very simple economics and our great Irish Government have blown it for us. Harvest while the sun shines is certainly what they done.

There are alot of thick professioanls out there. For example, Brokers believe that reducing stamp duty will assist the housing market, it had no effect back in April, why would it work now, why wont it work, because to all you brokers, its simple economics, a housing market is driven by first time buyers, majority of first time buyers including myself are purchasing either new houses with no stamp duty or second hand houses where the value of the house is less than 315k, o wait there is no stamp duty for first time buyers now at all. So makes no difference. So called professionals.

Housing market will only be relieved by a big decrease in interest rates and a deduction in the credit craunch which the Fianna Fail crowns have no power over.

Watch how there will be marginal increase in captial investment for the next year.

Watch how there will be inflationary increases in Social Welfare payments.

Watch how the gap between poor and rich widen once again.

Watch how Fianna Fail put their sticky hands in your pockets and laugh at you behind your back.

I will be listening to the budget over the next couple of hours carefully because this is the budget that will make or break the economy of this country.

Bertie Ahern and Brian Cowen, well done boys, time to sweat.

sovtek

kluivert wrote: »

There are alot of thick professioanls out there. For example, Brokers believe that reducing stamp duty will assist the housing market, it had no effect back in April, why would it work now, why wont it work, because to all you brokers, its simple economics, a housing market is driven by first time buyers, majority of first time buyers including myself are purchasing either new houses with no stamp duty or second hand houses where the value of the house is less than 315k, o wait there is no stamp duty for first time buyers now at all. So makes no difference. So called professionals.

Not so fast. If they drop stamp duty then they can increase their profit margin. It doesn't mean that prices will come down, only that the margins increase. It's like the publican jackals asking for a reduction in alcohol tax. It won't mean cheaper drink, only more profit for the criminal cartel.
I don't think they are thick...just greedy and corrupt.

Hitchhiker's Guide to...

kluivert wrote: »

Is there a specfic budget forum or will this be the trend. Am actually looking forward to the Budget this year, so I can tell everyone I told you so.

Fianna Fail - a bunch of crooks.

Its very simple economics and our great Irish Government have blown it for us. Harvest while the sun shines is certainly what they done.

There are alot of thick professioanls out there. For example, Brokers believe that reducing stamp duty will assist the housing market, it had no effect back in April, why would it work now, why wont it work, because to all you brokers, its simple economics, a housing market is driven by first time buyers, majority of first time buyers including myself are purchasing either new houses with no stamp duty or second hand houses where the value of the house is less than 315k, o wait there is no stamp duty for first time buyers now at all. So makes no difference. So called professionals.

Housing market will only be relieved by a big decrease in interest rates and a deduction in the credit craunch which the Fianna Fail crowns have no power over.

Watch how there will be marginal increase in captial investment for the next year.

Watch how there will be inflationary increases in Social Welfare payments.

Watch how the gap between poor and rich widen once again.

Watch how Fianna Fail put their sticky hands in your pockets and laugh at you behind your back.

I will be listening to the budget over the next couple of hours carefully because this is the budget that will make or break the economy of this country.

Bertie Ahern and Brian Cowen, well done boys, time to sweat.

woo-hoo for the rant!

It's almost possible to forget that we're one of the richest countries in the world

All politicians are the same, and they have very little impact over the economy which is broadly based on international economic trends.

kluivert

Roundtower2 wrote: »

woo-hoo for the rant!

It's almost possible to forget that we're one of the richest countries in the world

All politicians are the same, and they have very little impact over the economy which is broadly based on international economic trends.

Sorry it was susposed to be brief

Here listening to Radio 1 on my phone.

seanabc

It's starting in 10 minutes. I'm listening to the warm-up act on Newstalk.

Thank God I don't smoke anymore. I used to really dread this time of year!

mike65

Jasus get on with it. Listing water projects should be the job of the minister for environment.

Mike.

roughan

anyone heard if they are increasing the VAT threshold like they did last year?

Quality

Maternity benefit surely they can do better than €280 a week????


And a couple of days paternity leave for the daddys.....

mike65

VRT! Changes are as expected from July 1st. Co2 rating with 7 bands like white goods system 14-36%. Broadly revenue neutral he says. We'll see. VRT free hybrids? Or did I miss that?

Annual motor-tax up by 9 and 11% from Jan 1st (2500cc cut off). Then tax linked to CO2 from July.

Mike.

seanabc

VRT will be based on CO2 emissions rather than engine size from 1st July.

Quality

Car tax up by 9% 2 litre and under and 11% 2 litre +

death1234567

Quality wrote: »

Car tax up by 9% 2 litre and under and 11% 2 litre +

Bollocks monkey. Worst budget ever!

mike65

700 million capital programme for health.

30c increase in fags from midnight.

Mike.

seanabc

As I said earlier: Thank God I don't smoke anymore!

mike65

Income tax

Standard rate - unchanged and widened by 1400 pa (surprised tbh)
Higher rate - no mention
Credits up 70 single/140 married

Sec 481 relief continues.

Stamp duty cuts on plastic cash paid for by more expensive cheques!

Mortgage interest relief increased by 20% (I think)

Mike.

Colonel Sanders

mike65 wrote: »

Income tax

Standard rate - unchanged and widened by 1400 pa (surprised tbh)...

Stamp duty cuts on plastic cash paid by more expensive cheques!

Mike.

Both are surprising, the tax on credit/laser cards is unpopular but is a sneaky tax, like the insurance levy, that not many people spend too much time pondering. When they pay it once a year they give out, then forget about it in a weeks time.

mike65

Ooooh stamp duty changes. A banding system to be introduced starting at 4% (?)

Mike.

seamus

Looks like the existing exemptions still apply, but the first €125k of any purchase under €1m has no stamp duty, and the rest has duty at 7%.

Interesting.

seamus

seamus wrote: »

Looks like the existing exemptions still apply, but the first €125k of any purchase under €1m has no stamp duty, and the rest has duty at 7%.

Interesting.

So doing the maths on a €400 k purchase the new"over all" stamp duty rate on the "entire purchase price" there would be 4.81% ?

Trotter

I sell my old smokey car to buy a tiny, fuel efficient supermini with a CO2 emission equivalent to a fairy's fart...

What do I get in reward for being environmentally aware?

A rise in car tax by 9%.

I am so buying a landcruiser and everytime I rev it I'll give two fingers to those windy gutless Greens.

mike65

The new "greener" annual motor tax will be introduced from July 1st.

Mike.

Akrasia

mike65 wrote: »

The new "greener" annual motor tax will be introduced from July 1st.

Mike.

Todays budget was based on projected growth figures of 3%. We'll be lucky to get half of that. Guess what programs are going to be cut back come next autumn when our deficit is way up and tax take right down? that's right, the social programs.

Hitchhiker's Guide to...

Akrasia wrote: »

Todays budget was based on projected growth figures of 3%. We'll be lucky to get half of that. Guess what programs are going to be cut back come next autumn when our deficit is way up and tax take right down? that's right, the social programs.

lol - love the armchair economics. Are you coming up with the estimate that growth will be half the 3% based on any particular economics model? 3% is about consensus amongst actual economists who study growth rates.