Eamon Ryan
Question:66 Mr. Eamon Ryan asked the Minister for Finance if he will compare the inflationary effects of budget 2003 between that which he suggested they would be, and the way in which they have eventually transpired. [30075/03]
Written Answers. - Budget 2003.
In budget 2003, I estimated that the increases in indirect taxes would add 0.85% to the consumer price index. The Central Statistics Office estimates that the actual effect was something in the order of 1%. This small difference is accounted for by the difficulties in estimating the impact on the consumer price index of the 1% increase in the lower rate of VAT.
At the time of the budget last year, we projected the average annual inflation rate, inclusive of these changes, would be 4.8%. The actual outturn is now projected to be 3.5%.
In budget 2004, we estimate that the effect of the changes in indirect tax will add less than 0.4% to the consumer price index. The CSO has indicated that they are in agreement with this estimation.