The estimated Government current budget for 2015 is as follows: Government Current Income €45,255 m Government Current Expenditure €48,985 m (i) Calculate the current budget deficit - Leaving Cert Economics - Question 6 - 2015

1. Reduce Government Expenditure: The government could consider cutting down on unnecessary spending, such as reducing allocations to certain departments or social programs that may not have immediate or significant benefits.

2. Increase Government Income: This can be achieved through measures such as increasing taxes (for example, increasing income taxes or introducing new taxes) or improving tax compliance and enforcement to reduce tax evasion.

Example of Government Current Income: Income from direct tax revenue, such as personal income tax.

Example of Government Current Expenditure: Salaries of public sector employees.

The initials USC stand for Universal Social Charge.

Income tax is classified as a direct tax because it is levied directly on the income of individuals and corporations. It is based on the taxpayer's earnings, and individuals must pay it based on their financial capacity.

Reducing the rate of income tax may have the following economic effects:

1. The government’s current budget deficit: A reduction in income tax may lead to lower tax revenues for the government, potentially increasing the budget deficit unless offset by increased economic activity.

2. Level of employment in Ireland: Lower income tax rates may lead to higher disposable incomes, which could increase consumer spending and stimulate demand for goods and services, potentially leading to job creation.

One measure that could be taken to reduce the consumption of cigarettes is to introduce plain packaging for cigarette products. This would limit advertising and make cigarette packages less appealing, potentially reducing demand.

1. Greater Disposable Income: By smoking fewer cigarettes or quitting altogether, individuals can save money that would otherwise be spent on tobacco products, leading to increased disposable income for other expenditures.

2. Healthier Lifestyle: Reducing cigarette consumption can lead to better health outcomes, resulting in lower healthcare costs and potentially lower premiums for health insurance as individuals may require fewer medical services.

1. Greater Productivity/Reduction in Absenteeism: If fewer people smoke, there may be reduced absenteeism from work due to smoking-related illnesses. This could lead to greater productivity within the workforce as people stay healthier and attend work more regularly.

2. Improved Environment: Reduced cigarette consumption can lead to cleaner public spaces, as there would be less littering from cigarette butts, contributing to an overall enhanced environment and public health.