TODAY MARKED THE second day of Budget 2012, as finance minister Michael Noonan announced measures to raise €1.6 billion in new tax and revenue incomes.

Yesterday, Minister for Public Expenditure and Reform, Brendan Howlin, announced the government’s plans to public spending by €2.2 billion, with a €1.4 billion cut in day-to-day State spending.

While Noonan had to raise €1.6 billion, his task was softened by a ‘carry-over’ of around €600m from existing measures – meaning his tasks were only to raise €1 billion, with some €670m coming from the long-expected VAT hike.

See events as they happened on our liveblog here >

In full: Michael Noonan’s Budget speech to the Dáil >

Here are the main details from Michael Noonan’s Budget 2012 speech:

50 per cent employer PRSI pension relief abolished
Legislate tax betting and betting exchanges. Betting duty will apply to remote betting
Tax exemption for first 36 days of illness is ended
No excise increase on alcohol – will be subject to VAT increase
Cigarettes up 25 cent
Increase in Motor Tax from 1 January
Household charge of €100 – waiver for those on mortgage interest supplement, certain housing estates, and social housing.
Carbon Tax up from €15 per tonne to €20 per tonne. Increase of €0.01 on petrol from midnight, increase on other fuels (non-solid such as peat) from May next year.
Rental, investment and other income now liable for PRSI from 2013
DIRT is up 27 per cent to 30 per cent
VAT rates of 9 per cent for tourism and 13.5 per cent for home heating and other such amenities will remain in place
VAT increased from 21 per cent to 23 per cent with a promise of no additional VAT rises in lifetime of this government
€1 billion to be raised in indirect tax measures announced today. €600 million will be raised from existing measures
No increase in income tax, no increases in rates, no narrowing of bands.
Noonan to establish advisory group to advise on NAMA strategy for property disposals
Capital Gains Tax and Capital Acquisitions Tax will rise from 25 per cent to 30 per cent at midnight
Capital Acquisition Tax threshold falls from €332k to €250k
A property relief surcharge of 5 per cent will be imposed on investors with an annual gross income over €100,000
From January 1, exemption level on Universal Social Charge will rise from €4,004 to €10,036
First time buyers will get mortgage interest relief at 25 per cent in 2012
Increase mortgage interest relief to 30 per cent for first time buyers between 2004-08
Non-first time buyers will benefit from mortgage interest relief at 15 per cent
Capital Gains Tax incentive, property purchased between midnight tonight and 2013, gain will be relieved in full from CGT if kept for seven years.
Stamp Duty on commercial property to be cut from 6 per cent to 2 per cent, and will also apply to farmland from midnight tonight
Corporate tax exemption for start-up companies being extended by three years to 2014
There will be tax breaks for companies who invest in the s0-called BRIC (Brazil, Russia, India and China) countries.
Noonan announces foreign earnings deduction to assist exports, and assignee relief programme
Corporation tax will remain at 12.5 per cent and the government is committed to maintaining this. “There will be no change in Ireland’s 12.5 per cent in Ireland’s corporate tax rate,” Noonan told the Dáil.
Government predicts a 1.3 per cent growth in GDP next year and 2.5 per cent in GNP. Stronger growth expected in 2013.

The pre-budget leaks:

There will not be any change in income tax rates
The bands of the Universal Social Charge may be raised, in order to alleviate some of the charges on the worst-off
PRSI will be widened, meaning people will be liable for PRSI from rental income and other investments
There will be a 2 per cent rise in the top rate of VAT – bringing it from 21 per cent to 23 per cent, which is intended to raise €670 million
The seven bands of ‘traditional’ motor tax will be increased – RTÉ says the lower band, at €104, will go up to €160; the second band will rise from €156 to €225
DIRT will be increased from 27 per cent to 30 per cent (both sources) – the Herald describes this as a ‘tax on savings’
Carbon tax will be increased by €5 per tonne, putting around 2.5 cent on a litre of petrol and €15 on a tank of home heating oil
Capital gains tax will be increased from 25 per cent to 30 per cent
Capital acquisitions tax (the ‘inheritance tax’), currently levied at 25 per cent on all assets over €332,000, will have both its band lowered and its tax rate raised
There will be a new €100 household charge, to be paid by the owner (as opposed to the tenant or occupier) of a property; this is an interim charge in advance of a valuation-based property tax, or water charges, and will raise €160 million

Yesterday, Minister Howlin announced a number of cost-saving measures, including a standardising of child benefit payments; an increase in the student registration fee; a cut in the back to school allowance for the parents of children aged between 4 and 11; the closure of 31 garda stations; and jobseekers’ benefit being paid out for a five rather than six day working week.

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