Budget 2023 – The Cost of Living Budget
Budget Overview
Finance Minister Paschal Donohoe has announced a Budget of around €11bn.
As he delivered his Budget speech in the Dáil at lunchtime, Minister for Finance Paschal Donohoe said that Budget 2023 is and must be, a «cost-of-living budget», focused on helping individuals, families and businesses to deal with rising prices.
Among the main components is a package worth €1,100 for pensioners, an increase in the higher rate tax band to €40,000 and a reduction in childcare costs of about €170 per month.
€1.4bn allocated to the new Business Energy Support Scheme (BESS).
The Budget, announced two weeks earlier than usual, will also see the introduction of a €600 energy credit paid out to households in three installments to help stave off sky-rocketing energy costs.
Mr Donohoe highlighted the war in Ukraine as a major factor in the crisis currently being experienced, adding that Brexit could bring further challenges.
Cost Of Living Package
- Is a series of one-off spending measures to help people struggling to pay bills due to record levels of inflation
- €600 electricity credit taken off energy bills in three instalments over the coming months
- Child Benefit recipients will receive a double payment on November 1st
- There will also be a two double payments of welfare rates between now and the end of the year
- Under Business Energy Support Scheme (BESS), businesses can avail of grants up to €10,000 p.m., per premises to help with their energy costs, subject to meeting certain criteria
- Rainy day fund will benefit from €2bn of the exchequer surplus, with €4 billion earmarked for the fund next year
Pensions & Social Welfare
- Pensioners to receive one-off payments of up to €1,100 before end of year
- State pension of €253 will be paid twice in the coming months
- Living Alone allowance recipients will receive a separate €200 payment, those claiming Fuel Allowance will receive once-off €400 lump sum
- The Fuel Allowance scheme extended to up to 80,000 people who currently do not qualify for the payment, bringing the total number claiming to 450,000
- The weekly Fuel Allowance means limit for the over 70’s, increases to €500 for single people and €1,000 for couples
- Social Welfare rate increase by €12-per-week increase in the new year, along with a special once-off €500 payment for carers and people with disabilities this year
Taxation
- Standard Rate tax band of 20%, to increase by €3,200 from €36,800 to €40,000
- Personal tax credit will rise from €1,700 to €1,775
- Employee tax credit and the Earned Income Tax Credit will also increase from €1,700 to €1,775
- The 2nd USC band increases from €20,687 to €22,920 due to the increase in the minimum wage
- Small benefit exemption will rise from €500 to €1,000. In addition, two vouchers can be given under the exemption in this tax year if an employer wishes to do so
- Personal tax credits for carers will also increase by €100, from €1,600 to €1,700
Housing
- Standard Rate tax band of 20%, to increase by €3,200 from €36,800 to €40,000
- Personal tax credit will rise from €1,700 to €1,775
- Employee tax credit and the Earned Income Tax Credit will also increase from €1,700 to €1,775
- The 2nd USC band increases from €20,687 to €22,920 due to the increase in the minimum wage
- Small benefit exemption will rise from €500 to €1,000. In addition, two vouchers can be given under the exemption in this tax year if an employer wishes to do so.
- Personal tax credits for carers will also increase by €100, from €1,600 to €1,700
Transport & Climate
- Excise duty reduction to continue, 21c per litre for petrol, 16c cent per litre for diesel and 5.4c per litre for Marked Gas Oil (MGO)
- The rate per tonne of carbon dioxide emitted for petrol and diesel increasing from €41 to €48.50 from 12 October, resulting in an increase c2% per litre of petrol and diesel
- A 10% concrete block levy introduced to including pouring concrete and other concrete products
- 20% public transport fare reduction and the Youth Travel Card discount of 50% on all operators’ services extended to end of 2023
- €337 million pledged to energy efficiency measures, an 32% increase on last year, with 37,000 home energy upgrades
- All schools to be eligible for funding for solar panels
Third Level
- Student Contribution Fee cut by €500 for eligible families earning between €62,000 and €100,000
- Income limit to qualify for a 50% reduction in contribution fees under SUSI will be increased from €55,240 to €62,000
- All SUSI maintenance grants will be increased by between 10% and 14% in September 2023
- Once-off €1,000 increase to the post graduate fee contribution grant
- Post-Graduate Fee Contribution Grant for eligible students of €3,500 will increase by €500
- An extra €10 million for further and higher education institutions to help with rising costs
Agriculture
- Five agricultural tax reliefs to be extended – Young Trained Farmer and Farm Consolidation Stamp Duty Reliefs, the Farm Restructuring CGT relief, and the Young Trained Farmer and Registered Farm Partnership Stock Reliefs
- Agri-green diesel will also benefit under marked gas oil reduction of 5.4%
- A new scheme will help provide accelerated capital allowances to farmers for the construction of modern slurry storage facilities
Childcare & Education
- Childcare fees to be cut by up to 25% for those availing of the National Childcare Scheme, costing €121million
- Free primary school books for all children
- 370 additional teacher posts further reducing the pupil to teacher ratio of 23:1
- 1,194 additional Special Needs Assistants, bringing total overall to 20,300
- 4,800 additional apprenticeship places and 4,000 further education registrations
Healthcare
- An overall package of €443 million to help reduce waiting lists
- Free GP care extension will see a further c70,000 children aged six and seven become eligible for free doctor visits by the end of the year
- Free GP visit card by April 1st next year to help c360,000 adults and children in low-income homes
- IVF public funding of €10m being allocated in 2023. including subsidising private IVF
- Free contraception expanded, currently available to women aged 17 to 25, to those aged from 16 to 30 years
Defence Forces & Garda
- Defence budget is set to increase by more than €1.1bn
- Includes €176m on building projects at barracks, new vessels for the navy, new aircraft for the Air Corps and more armoured vehicles for the Army
- 1,000 new gardaí and extra civilian garda staff
Other
- Newspapers will be zero-rated for Vat in today’s speech from January 1, also apply to digital editions and subscriptions
- Knowledge Development Box to be extended for 4 years
- The Special VAT rate for hospitality of 9% will expire at the end of February 2023
- Cigarettes will cost an extra 50c from tonight, but there will be no increase in price of alcohol