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An Buiséad / The Budget
06-Dec-2012

The Good, the bad and the ugly.

RECOVERY PLAN IS WORKING
Economy grew by 0.9% in 2012 and will grow by
1.5% in 2013
NTMA has raised over €7 billion in second half of
2012,  Banks  &  Semi-States  are  back  in  the
market, yields continue to fall and we are on target
to emerge from EU/IMF programme in 2013.
Unemployment levels remain  too high but latest
figures show a  fall on an annual basis for first
time since 2005
General Government Deficit of 8.2% projected for
2012, well within our programme commitments for
a second year and Budget 2013 will deliver target
of 7.5%
General Government Debt will peak in 2013
IMPLEMENTING OUR PLAN
Fair, equitable and designed to limit the impact
on the most vulnerable and support job creation
After Budget 2013, 85% of adjustment completed
No increases to income tax credits, rates or bands
No change in basic weekly social welfare rates &
frontline services prioritised in Education & Health
BROADENING THE TAX BASE
Motor tax and VRT will be increased with  dual
registration of 131 & 132 introduced
Excise duty on alcohol increased for first time in
a decade & also increased on tobacco
Local Property Tax (LPT) payable at a rate of
0.18%  of  the  market  value  of  properties  (by
reference to bands of €50,000) up to €1m and
0.25% on any balance above  €1m
Household charge will be abolished and LPT
will be payable from the 1st of July for half year
only
FAIRER TAXES
Tax relief on pension contributions limited to
pensions of €60,000 or less from 2014 affecting
high earners in public and private sector
Top Slicing Relief limited to non-statutory  exgratia  termination  and  severance  payments  of
less than €200,000
CGT, CAT and DIRT increased to 33%
Standard rates of USC (7%) applied to those
aged 70 years of age and over and all medical
card holders earning €60,000 (twice the average
industrial wage) and above.   
SECURING THE PRSI SYSTEM
PRSI base broadened by increasing the annual
minimum contribution for self-employed to €500
and removing the €127 weekly PRSI allowance
Employees  who  earn  €352  or  less  per  week
continue  to  have  no liability to  make  a PRSI
contribution are not affected
For  modified  rate  contributors income  from  a
trade or profession will be subject to PRSI as will
their unearned income with effect from 1 January
2013
Unearned  income including  rental,  investment,
dividends and deposits income will be subject to
PRSI for PAYE employees from 2014
SUPPORTING JOB CREATION AND ECONOMIC
RECOVERY
A  Ten  Point  Tax  Plan introduced  for  SME’s,
including farms, to enhance cash flow, to reduce
administrative burden and to assist companies to
grow and expand into new markets and products
A Rebate on Diesel for licensed hauliers from 1
July 2013 to reduce transportation costs
Support  for  the  Tourism  sector  through  the
Gathering 2013 and 9% VAT maintained for 2013
Local property tax (LPT) introduced as opposed
to  income  tax  increases,  to  minimize  negative
effect on jobs and the economy
LPT  includes  exemptions  up to 2016  for new
and previously unoccupied homes and also for
first  time  buyers in  2013  to  support  emerging
recovery
Five-year Capital Framework of €17 billion out to
2016 of which €3.5 billion allocated in 2013  and
capital programmes augmented by PPPs
Access to 30% of AVCs to be allowed until 2016
and 0.6% Pension levy will be abolished in 2014
New SME Funding Supports being developed by
NPRF

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