Emergency Budget measures come into effect
Tax hikes and other measures introduced in the emergency Budget come into effect today – while gas and electricity prices are set to fall.
A doubling of existing income and health levies and increased PRSI payments will hit workers’ pay packets at the end of the month.
Homeowners with mortgages more than seven years old will also lose mortgage interest tax relief from today.
The Labour Party described the introduction of the Budget measures as a “May Day massacre” and said middle income workers were “being turned on a financial spit”.
Gas and electricity bills dropped by 12% and 10% at midnight and the Commission for Energy Regulation said further reductions were expected in the autumn if wholesale prices remained low.
“May Day is normally an occasion of celebration for workers, but for many Irish workers today will be a grim day as they open the wage packets or examine their pay cheques and see for the first time as the Budget changes take effect, the full extent of the tax hit that Fianna Fáil has inflicted on them,” said Labour leader Eamon Gilmore.
“This is nothing short of a May Day tax massacre for Irish workers, who from today face increased tax and health levies and, in some cases, increased PRSI payments.”
Labour claimed that a couple each earning €45,000 per annum would be hit with an additional €1,800 due to the health levy and €900 with the income levy.
“Many will also be losing their tax relief on mortgage interest payments from today.
“And if this couple work in the public service, all this comes on top of the so-called pension levy that was taken out of their pay packets in March,” added Mr Gilmore.
Labour said families were being made to pay a huge price for 12 years of financial recklessness on the part of Fianna Fáil.
The Government insisted the measures were necessary and that everybody must share the pain of correcting the public finances and stabilising the economy.
But Mr Gilmore added: “Those who find their wages filleted today will have the ideal opportunity to deliver their verdict on the budget tax changes and on the performance of Fianna Fáil when they go to the polls for the local and European elections on June 5.”
