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Budget 2023 being finalised - here's what we know and what's still being worked out

A rent credit, double social welfare payments, and tax changes are on the way.

Image: Alamy Stock Photo

BUDGET 2023 WILL take place tomorrow with Government leaders meeting today to work out some of the last remaining details. 

The coalition leaders also met yesterday, with the meeting going late into Sunday night. 

It looks like the budget package will not go above €7 billion, with the cost-of-living package coming in at around €3 billion, with €1 billion for a contingency fund. 

Sources have said the budget is “very tight” with Finance Minister Paschal Donohoe and Public Expenditure Minister Michael McGrath looking to squeeze in as much in as possible.

So what do we know so far? Let’s take a look: 

Income tax / USC

  • The top tax band has been pushed out to €40k for single people and up to €80k for a couple – worth €800 a year to those on the higher rate and up to €1,600 for a couple
  • There will be some minor tweaks to the USC to take into account the rise in the minimum wage, as well as some small changes to PRSI

Housing

  • The much talked about tax credit for renters has been agreed. It will be per renter rather than per tenancy, so if there are two or three sharing a property they will all get the credit. While discussions are still underway on the amount it looks like it could be around €400-€500 range per renter
  • There will also be what sources describe as “minor changes” for the tax treatment of landlords
  • The Help-to-Buy Scheme is being extended for two years

Social Welfare

  • Double welfare payments will be made soon after Budget
  • Social welfare payments is set to increase by €12 per week
  • Fuel Allowance is set to be increased and the threshold changed to allow more people to be eligible
  • A widening of the eligibility criteria for the working family payment
  • A once off payment of €500 for carers of people with a disability

Childcare

  • A a 25% reduction in childcare costs has been agreed as well as increased subsidies

Health

  • Publicly-funded IVF will begin in 2023 under a new multi-million Euro fund.
  • Hospital inpatient charges are being scrapped.

Business 

  • Two new schemes will be announced tomorrow to help businesses with the cost of electricity and gas – The first is a €200 million scheme administered by Enterprise Ireland for larger firms involved in exporting and manufacturing. Businesses can receive up to €2 million in financial aid. They will have to produce a business plan that shows how they will get through the crisis and control their energy costs.
  • The second scheme is targeted at SMEs. The TBESS – Temporary Business Energy Support Scheme, will cover 40% of the increase in electricity or gas bills, up to a maximum of €10,000 per month per business. It will be administered by the Revenue Commissioners, will be backdated to September, run at least to February and is estimated to cost around €1 billion.
  • These two measures will also be backed up by a new low-cost loan similar to the Brexit and Covid loans.

Third-level Education

  • Third-level fees will drop by €1,000 in tomorrow’s Budget, with immediate effect
  • Any family earning under €100k will see a permanent reduction of €500 in fees
  • Any family earning under €62k will pay no more than €1,500 in fees
  • All students will see a €1000 reduction this year.
  • All student grant recipients will get a double payment and PHD students will get a once-off cost of living payment before Christmas

Justice

  • 1,000 new Gardaí into Templemore next year
  • Over 400 new Garda staff to help free up frontline Gardai for core policing dutie
  • An increase in Garda overtime to help Gardai tackle crime and anti social behaviour

Other items of note:

  • Electricity credits amounting to €600 over three bills
  • Free school books for all primary school students from next September
  • Extension of public transport fare reductions
  • €1k tax free bonus allowed to be given by employers, increased from €500
  • A Vacant Property Tax is also set to be a part of Budget 2023
  • A €500 reduction in third-level fees is expected
  • The introduction of 0% tax on newspapers
  • An increase in the overseas development aid package.

More as we get it…

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