The Minister for Finance Mr McCreevy has warned that with income tax receipts down, next year's opening budgetary position will be very difficult.
The Minister was speaking in Luxembourg as EU finance ministers met this morning to study the euro zone's deficit-cutting accord ahead of talks aimed at resolving the savings tax row with Switzerland.
Mr McCreevy said the situation was quite severe with less resources to spend, coming up to the publication of the estimates in November.
He said: "Gross rates next year would be not of the order of the 5 per cent level of this year" because of lower tax returns.
"With less gross and less resources, there would proportionately be less expenditure, but nonetheless it would be a fairly substantial increase on this year," he added.
