Two Government ministers have played down suggestions that income tax increases would be introduced in December's budget and insisted public spending growth would still be 14 per cent next year.
The Minister for Justice, Mr Michael McDowell, said he did not expect personal tax rates to rise in the Budget, clarifying remarks he made on RTÉ's Six One News last night when he said tax rates were a matter to be decided in the Budget.
Earlier, The Minister for the Environment and local government, Mr Cullen, said there was "no suggestion" of tax increases at the moment and that it would be premature to make predictions about the future state of the economy until the next set of Exechequer figures on December 4th.
He accepted the State would now have to borrow €750 million to balance the books, despite predictions by the Minister for Finance, Mr McCreevy, last May that Ireland would have a surplus of €170 million by the end of the year.
However, Mr Cullen denied the Government had mislead the country and said that "there was never at indication at the time that we wouldn't come in with a small surplus".
He said trading conditions throughout the world have continued to worsen despite assurances from Mr Alan Greenspan, chairman of the US Federal Reserve, that the world economy had bottomed out in July and was likely to improve.
"We all can only operate on that basis," Mr Cullen said. "Ninety per cent of what is produced here is for export so we are very dependent on foreign markets".
But Fine Gael insiststhe Goverment deliberately misled the people before last May's election, citing last month's leaked Government memo to civil servants calling for €900 million in cuts as evidence.
Responding to Mr Cullen on RTÉ's Morning Irelandthis morning, Fine Gael finance spokesman Mr Richard Bruton said the public had been "clearly conned up to the eyeballs".
