The taxation of income in particular was increased, and a four-year plan of tax and expenditure changes designed to restore stability to the public finances was under way. Additional fiscal pressure was emerging from the banking system.
Initially interpreted as merely part of the global liquidity tightening that emanated from the US subprime problems, the Irish banks were encountering increasing difficulties in rolling over their international borrowings: maturities were shortening and the geographical spread of the providers of funds narrowing (Lane 2015).