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Ireland’s 2011 Budget: Main Spending, Taxation Measures

Dec. 7 (Bloomberg) -- Following are the key measures in Irish Finance Minister Brian Lenihan’s 2011 Budget, announced in the parliament in Dublin today.

-- No reduction in the state pension in 2011
-- Working-age pension payment to be reduced 4 percent
-- Child benefit to be reduced by 10 euros, with additional 10-
euro cut for a third child
-- Capital programme will be about 3.6 percent of GNP in 2011.
-- Prime minister’s salary will be reduced by more than 14,000
euros a year
-- Ministers’ salaries will be reduced by more than 10,000 euros
a year
-- Government to apply maximum salary rate of 250,000 euros in
the public sector
-- Public service pensions above 12,000 euros a year will be
reduced by an average of 4 percent
-- Income Levy and Health Levy to be abolished; replaced with a
single Universal Social Charge
-- Employee PRSI contribution ceiling removed
-- Value of tax bands and credits reduced by 10 percent
-- Maximum weekly social- welfare payment for people of working
age will be cut by 8 euros from January.
-- The base for Capital Acquisitions Tax broadened by reducing
the tax-free thresholds by 20 percent
-- Deposit Interest Retention Tax rate on ordinary deposit
accounts increased by 2 percent to 27 percent and on longer-term
deposit accounts by 2 percent to 30 percent
-- No change to the 12.5 percent corporation tax rate
-- Stamp duty: a flat rate of 1 percent on all residential
property transactions up to a value of 1 million euros, with 2
percent applying to amounts above 1 million euros
-- Air-travel tax to be reduced to 3 euros from March 1.
Government will review the tax in 2011.
-- Excise will be increased by 4 cent per liter on petrol and 2
cent per litre on auto-diesel
-- Legislation to facilitate further burden-sharing by
subordinated bondholders will be submitted to the parliament
next week

SOURCE: Irish Finance Ministry

To contact the editor responsible for this story: Fergal O’Brien in London at +44-20-7330-7152 or fobrien@bloomberg.net

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