The Taoiseach said that while the next budget will include tax cuts and a welfare package, it is also important to reduce the country’s debt and set up an “anti-austerity fund” for the future.
Speaking at the Bloomberg New Economy Gateway conference in Wicklow, Leo Varadkar was asked how the government would spend the record corporate tax revenue it is currently receiving.
Mr. Varadkar stressed the fact that the country’s per capita debt is quite high at EUR 250 billion and that the debt would not be ignored when managing the budget.
“Yes – we will reduce income taxes, yes – there will be a welfare package in the budget to help people with the cost of living particularly pensioners and people on social welfare and yes – we will invest more in capital infrastructure but it is also important that we set aside some of that windfall gain and pay down debt,” Mr Varadkar said, reports RTE.
The Taoiseach said the energy support is linked to energy prices and will not be withdrawn too quickly.
He said while inflation is falling, overall prices are not falling, reports RTE.
He said the government will continue to focus on areas it can influence, such as childcare.
“When you see rises in the cost of living, it is not unreasonable for people to say they should see an increase in what they are paid, an increase in take home pay after tax, and that is something we can afford,” Mr Varadkar said, reports RTE.
When asked about Brexit, the Taoiseach said a future UK government could seek a closer relationship with the EU and that the door is always open.
Treasury Secretary Michael McGrath also attended the Bloomberg New Economy Gateway conference.
“Because the surpluses are largely going to be sourced from revenues that are potentially quite volatile in nature, corporation tax revenues which may well be of a windfall nature, and given that we know there are real costs coming down the line given the changing demographics of the country, I think it does make sense to put funding away into a longer term fund, a reserve fund, a resilience fund which will be available to meet those costs into the future,” Mr McGrath said, reports RTE.
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