Michael Noonan (Limerick City, Fine Gael)

If one looks at the supporting documents and at the tables of income for different families and people in different family situations, one will find that we have achieved a first. If one looks across different families and partnerships, one will see the income from their wages and salaries will be exactly the same. I do not think that has ever happened before in a budget.

The Government has very carefully considered the options open to it. We must find €1 billion and there are options. There are five main sources of taxes - corporation tax, income tax, VAT, excise and capital taxes. Everybody knows that under the EU-IMF programme, expenditure has to decrease and taxes have to increase. Direct taxes such as income tax and PRSI have abiggerimpact on jobs than indirect taxes. If one taxes something, one usually gets less of it and income tax and PRSI are taxes on jobs. Indirect taxes have a lower impact on economic growth and jobs. That is why the bulk of the adjustments being made in this budget will be through increases in VAT and capital taxes.

The Opposition has already criticised this approach, but it should make clear in its replies to the budget what its alternatives are. Is it suggesting income tax should be increased or that we should welch on our commitment that the 12.5% corporation tax rate is sacrosanct?

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