McCreevy warns tax revenue less that expected
Finance Minister Charlie McCreevy has revealed that tax revenues at the end of 2002 will be significantly less than forecasts at the start of the year.
Speaking to reporters in Dublin, Mr McCreevy also confirmed that pay-outs promised under the controversial Special Savings Incentive Scheme will be honoured, despite the deteriorating state of the public finances.
According to a leaked memo published at the weekend, this scheme is set to cost taxpayers €1.25bn more than expected over its five-year duration.
Mr McCreevy’s statement today on dwindling tax revenues confirms widespread beliefs that the economic downturn has all but killed the Celtic Tiger boom.
With government income falling rapidly and spending spiralling out of control, the Finance Minister is facing some difficult decisions at budget time in December.
The memo leaked on Sunday shows that Mr McCreevy is seeking some €900m in spending cutbacks next year, but many observers believe he may also opt to increase indirect taxes.
Official Exchequer figures due to be published next week should give a clearer picture of the overall financial situation and the scale of action needed to keep the budget from falling into deficit.
