McCreevy increases tax-free threshold to £165

The Minister for Finance, Mr McCreevy has increased the tax-free threshold for the standard rate of income tax by £19 to £165 in his Budget today.

In announcing his changes to the tax system, Mr McCreevy said his measures would remove some 68,000 from the tax net.

In other main points, employers’ PRSI has been cut to 10.75 per cent and corporation tax has been reduced by one point to 16 per cent.

Mr McCreevy has also reintroduced interest relief on the calculation of rental income in an attempt to aid the ailing property market.

Mr McCreevy also imposed increases on the old reliables. A packet of 20 cigarettes will rise by 10p and petrol and diesel will rise by 5p per litre from midnight.