The government will this week be told by the state’s fiscal watchdog that it should direct billions of euros in corporate tax revenues into a “prudence account” rather than spending it on services or tax cuts. The recommendation is contained in a draft of the June report of the Irish Fiscal Advisory Council (Ifac), which has been seen by The Irish Times. Under its suggestion, any corporate tax revenues above a level which is forecast at the beginning of the year should be allocated to the “prudence account”. This would, at the year end, be turned over to the rainy day fund used to pay down debt, or set aside for another purpose. The council suggests that governments should effectively lose the power to spend excess revenues, by mandating that unexpected windfalls should go into the prudence account.

Source: The Irish Times June 10, 2019 03:56 UTC