Analysis: Minister Donohoe, this is what you should and shouldn't do on Tuesday

Victor Duggan Economist SOMETIMES GOOD NEWS is bad news. News a month out from your annual budget announcement that the public coffers were brimming with unanticipated largesse was the last thing Paschal Donohoe will have wanted to hear. Why?

We’re not sure if, and we don’t know when, but we must at least acknowledge the risk that a significant share of this year’s corporation tax receipts will not be repeated indefinitely. It makes sense not to build in recurring spending pledges on the basis of revenue we can’t count on. We have made that mistake before.

In fact, fiscal policy has actually been strongly deflationary in both 2021 and 2022 as pandemic spending measures are wound down and economic recovery boosts tax receipts. From a microeconomic point of view, the government can have a direct impact on prices through taxes and regulation. Indirect tax rates should not be increased, and temporary reductions should be extended.

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Do set out a multi-annual budget to deliver Sláintecare, with a near term focus on reducing out-of-pocket expenses

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