TRANSPORT MINISTER LEO Varadkar has said that the property tax has played a part in Ireland’s return to recession which was confirmed in poor economic growth figures released yesterday.

Speaking to Morning Ireland, Varadkar said that the CSO figures showing that Irish economic output shrank by 0.6 per cent in the first quarter of this year, in addition to revised figures showing a lack of growth last year, are “bad”.

“There’s no point in pretending otherwise,” he said, explaining that the figures reflect the fall in exports and the lack of demand domestically as a result of some budget measures introduced last year including the property tax which has yielded some €121 million so far.

He said: “These figures are bad and they reflect both a fall in exports due to recessions elsewhere but also a lack of domestic demand in Ireland and you know the budget measures, like the property tax for example, contribute to that.

Despite this Varadkar said that there was a still months to go before the budget in October and indicated that the government would have a better impression of what economic outlook it is facing ahead of that budget later in the year.

“If taxes come in one per cent behind target and spending comes in over target then that billion is gone,” he said. “However if things area a little bit better and taxes come in ahead of target and spending behind target then we’ve more than a billion in flexibility.

Varadkar was also asked about the publication of the Anglo Tapes and said they were “very damaging”.

“What these tapes have done is remind the world of the culture and the banking system that existed under the last Fianna Fáil government government,” he said, adding: “I think that’s been very difficult for people.”