Dick Spring
Question:49 Mr. Spring asked the Minister for Finance if he will make a statement on the report of the Budget Day Working Group. [9733/01]
Written Answers. - Budget Day Working Group.
On 20 July 2000, I announced that from 2002 the income tax year will be aligned with the calendar year. From that point, budget day tax changes and social welfare weekly rate improvements will be brought forward to 1 January. This will be of importance to taxpayers and social welfare recipients who will benefit earlier from budget day changes compared to the current position where tax changes apply from April and social welfare changes from May.
A Department of Finance working group was established to report on the date of budget 2002. As part of its deliberations, the group consulted officials from both the Revenue Commissioners and the Department of Social, Community and Family Affairs.
In general, the group favoured moving to an earlier budget date than at present for the years subsequent to 2002 when once-off factors such as the short tax year and the euro changeover will not apply. The group also concluded that, on balance, a December date for budget 2002 minimised the potential risks for this year.
The date of budget 2002 was subsequently announced as taking place on Wednesday, 5 December 2001 with budget day tax changes being put into effect around end-February 2002. Where relevant, this will involve a once off correction payment to cover any arrears from 1 January 2002. Social Welfare changes will come into effect from mid-February onward and will also include a lump sum payment to cover any arrears from January 2002. It should be noted that under current arrangements, even if the budget date were moved to an earlier autumn date, those on long-term social welfare benefits could not have been paid their increases from January 2002.
The working group's report is available on the Department's website, and I am arranging to have a copy sent to Deputy Spring.