IT WAS a Budget for the middle income earners. If you are single and earn around £14,000 or £15,000 - or married earning £28,000 to £30,000 - have a lot of children but no mortgage, and live in a salubrious Dublin suburb, you've hit the jackpot.
Your Budget prize is to see a rise of a little over 4 per cent in bake home pay. In cash terms this is a little over £8 a week for a single person - the price of a couple of pints and a packet of cigarettes.
Many middle income earners, particularly in Dublin, can add to this the further savings from the abolition of Residential Property Tax, announced at the end of last year. Meanwhile, those with large families will gain from an increase of £5 a month in child benefit for third and subsequent children.
But it's not all good news. Mortgage holders will lose out as tax relief is scaled back for the third year.
The Budget is aimed at two particular constituencies. One is obviously the electorate. The other is the trade union movement which will soon vote on Partnership 2000. It remains to be seen if it will approve of the scale and spread of the tax benefits.
Middle income earners gain proportionately most from the Budget because they earn enough to benefit significantly from the cut in the standard income tax rate, the increase in tax allowances and the widening of the standard rate band. Higher earners gain more in cash terms in many cases, but do not gain as much as a proportion of their income.
The Budget spreads its benefits widely.
. Business is to gain from lower corporate tax and many smaller companies in particular will have seen a significant fall in tax bills over the past couple of years;
. Family firms will gain from further relief in capital acquisitions tax;
. A special package is included for farmers, who will also benefit from the general income tax reductions;
. Social welfare payments are generally increasing by 4 per cent.
The Budget will add fuel to an economy that is already growing rapidly. It will add some £400 million in higher spending and lower taxes this year.
There are fears that this could stoke inflation. The economy has managed to grow rapidly over the past three years while maintaining low inflation, and doing so this year is particularly important as it will count towards qualification for the single currency.
The Central Bank had warned against an expansionary Budget. But it is unlikely to respond to Mr Quinn's package with an early increase in interest rates, as this in itself would do relatively little to control inflation.
The Government will hope the trade unions will sign up to Partnership 2000, the new national agreement, as this would underpin wage moderation in the private sector at a time of high economic growth and profitability.
For the first time, the Budget includes predictions for the public finances and the economy over the next three years. Mr Quinn foresees continued strong economic growth and Exchequer borrowing held at 1.5 per cent of Gross National Product, well below the Maastricht ceiling of 3 per cent.
The Minister also announced that the 1998 budget will be ink November 1997. Only a chosen few know whether he was serious, when he said he hoped to deliver it himself.
