In a review of the Irish economy, the IMF says a gradual increase in tax revenue should be considered after next year, once a recovery from Covid-19 has taken hold.
It has welcomed the establishment of the Commission on Taxation and Welfare and says the tax base needs to be broadened.In today’s review, the IMF says more money needs to be spent on education, vocational training, reducing the cost of childcare and the provision of social and affordable housing.It says this needs to be done to retain Ireland’s advantages as a location for foreign direct investment and to minimise any long term affects from the disproportionate impact Covid had on the domestic economy.
It describes the impact of Covid on the economy as “highly asymmetric” with strong growth from the multinational dominated manufacturing and computer services sectors “softening the blow” to the rest of the economy.
Michael McGrath said that with the economy starting to reopen as the vaccine rollout continues, Government is committed to supporting society and the economy to recover from the impact of the pandemic.He said that key requirements for an inclusive and sustainable recovery noted by the IMF, including upskilling and investment, are priorities for Government.