The new Fine Gael-Labour coalition government is planning to impose a property tax on family homes, to freeze income taxes and to review the universal social charge.
Sources close to the negotiations revealed that Michael Noonan, the former Fine Gael leader, will be the next minister for finance
The negotiators have also agreed to bring the exchequer deficit within EU guidelines by 2015 — a widely-expected compromise between Fine Gael’s proposal of 2014 and Labour’s preferred date of 2016.
We wait to see whether the programme for government has to say to make such a “ compromise”“ meaningful.
Meanwhile, German chancellor Angela Merkel has taken a hard line on demands from Mr Kenny for better bailout terms, saying she expects concessions in return for any easing of the EU-IMF deal.
Dr Merkel and Mr Kenny had a brief “informal” meeting in Helsinki last night at which she congratulated him on his election victory.
A spokesman for Mr Kenny said the discussion “went well”, but the chancellor made it clear she expects reciprocal measures if bailout recipients are granted “relief” by their euro zone partners.
“It will be always about taking and giving. It does not make sense to help one country if there are no new conditions on another issue,” she said.
The chancellor also said “there’s no use in offering relief” unless “conditions get tougher” for the countries that seek it. “On this basis, we’ll talk with these countries.”
Mr Kenny’s spokesman said the two leaders “didnt get into that level of detail” when asked whether Dr Merkel had specified what she wanted in return for better bailout terms. While Irelands corporation tax regime has been a frequent target of German criticism, Mr Kenny said he would be making no concessions on that front.