Ireland Imposes 6th Straight Austerity Budget

By SHAWN POGATCHNIK

DUBLIN (AP) ⿿ Ireland's government unveiled plans for ⿬3.5 billion ($4.5 billion) in new taxes and spending cuts in the debt-burdened country's sixth straight austerity budget.

Finance Minister Michael Noonan told a hushed parliamentary chamber that Ireland must keep slashing its deficits down to the eurozone limit of 3 percent of GDP and it "still has a long way to go." He said Ireland expects to report deficits of 8.2 percent this year and 7.5 percent next year, but only if the country can deliver stronger economic growth in the face of deepening cuts.

Noonan vowed that the government would "lead this country out of the despair and despondency and lack of self-worth in which we found ourselves in March 2011," when the government gained power.

His 2013 budget includes plans for a new property tax; higher taxes on the incomes of pensioners who receive more than ⿬60,000 ($78,000) annually; and ⿬2 billion in cuts to government spending, including on state-subsidized medical care and payments to parents based on the number of children they have. The cost of buying and keeping vehicles, already exceptionally high by European standards, was due to increase again.

He also raised taxes on alcoholic and tobacco products, a significant factor in Ireland's household average. Each pint of beer and standard measure of whiskey will cost 10 cents (13 U.S. cents) more as of Thursday, bottles of wine ⿬1 ($1.30) more, each pack of 20 cigarettes 10 cents more.

Ireland has endured increasing austerity since 2008, when a decade-long property boom fueled by access to cheap eurozone credit went spectacularly bust. The previous government was forced to nationalize five banks and, in late 2010, Ireland become the second eurozone country after Greece to negotiate an international bailout.

Ireland's European and International Monetary Fund loans are due to run out next year, by which time the government hopes to have reassured global investors enough to resume the normal sale of bonds at affordable rates. Its treasury has already mounted several successful bond sales since July.

If you liked this article you might like

What's Behind the Surge in Energy Stocks

Hillary Clinton Says Prosecuting Individuals is Key to Wall Street Reform