Budget 2018: Main Points
10 October 2017 Latest News Local News National News News
Paschal Donohoe started his first Budget as Finance and Public Expenditure Minister saying the announcement would “build on progress that would have seemed impossible only a few short years ago”.
But how does this year’s Budget, delivered this afternoon, affect you?
|There will be a €5 increase in all weekly social welfare payments, including the State pension. This will kick in at the end of March 2018|
|The Christmas bonus payment of 85% will again be paid to all social welfare recipients in 2017|
|Also from March, an increase in the earnings disregard (ie the amount a person may earn from employment and still get the full rate of benefit) for those on the One Parent Family Payment and on the Job Seekers Transitional scheme by €20 a week, to €130|
|A new weekly telephone support of €2.50 announced for people in receipt of both the living alone allowance and the fuel allowance|
|The point at which an income earner attracts the higher rate of income tax will rise next year by €750 per annum|
|The entry point to the higher rate for single earners will increase from €33,800 to €34,550|
- The 2.5% USC rate to 2% and increasing the ceiling for this new rate from €18,772 to €19,372
- The 5% rate of USC to 4.75%
The USC may be on the way out. A working group is to be set up “to plan, over the coming year, the process of amalgamating USC and PRSI over the medium term”
|There will be a €200 increase in the Earned Income Credit, bringing it to €1,150 per year from 2018. According to the Department, “This increase will benefit over 147,000 self-employed individuals generating economic activity across the country”|
|There will be a further increase of €100 in the home carer credit, bringing the value of the credit up to €1,200 per year|
|An extra €500 million will be provided to the direct building programme|
- This will see an additional 3,000 new build social houses by 2021 – that’s 3,000 more than the target originally set out in the government’s major housing and homelessness plan Rebuilding Ireland
- Additional funding for a scheme that secures non new-build social homes will lead to an increase of 4,000 homes next year
|The Housing Assistance Payment scheme will be increased by €149 million|
|Up to €750 million of the NTMA-controlled Ireland Strategic Investment Fund will be made available for commercial investment in housing finance. The funds are to be made available to a new vehicle to be known as Home Building Finance Ireland or HBFI|
|Funding for homeless services – including providers of emergency accommodation and other supports – will be increased by a further €18 million to over €116 million|
|The vacant site levy will more than double from 3% to 7% on land not sold by 2019. The message to so-called land hoarders: “You need to get on to developing your lands urgently.”|
Rainy day fund
- Donohoe pledged to establish a Rainy Day Fund in 2018 and transfer €1.5 billion to it from the Ireland Strategic Investment Fund.
- The level of stamp duty on commercial property transactions will increase from 2% to 6% from midnight tonight, as had been widely flagged.
- Excise duty on a pack of 20 cigarettes will rise by 50 cents, with a pro-rata increase on other tobacco products. This will increase the price of a regular brand packet of 20 to €12. This kicks in at midnight tonight.
- As promised last year, a sugar tax is on the way in 2018 – at a rate of 30 cent per litre on drinks with over 8 grams of sugar per 100 millilitres
- There will be a reduced rate of 20 cent per litre on drinks with between 5 and 8 grams of sugar per 100 millilitres
The sugar tax will kick in in April next year.
- The minister plans to increase the VAT rate on sunbed services from 13.5% to 23%
- The VAT rate in the tourism and services sector will not change
|Donohoe pledged an additional 1,300 teaching posts in schools in 2018|
|As part of this hiring drive the pupil-teacher ratio will be reduced to 26:1|
|There will be a rise in the number of Special Needs Assistants – a 1,000 increase will bring the total number to over 15,000 next September|
- The free pre-school programme will be further developed – ensuring entitlement to the full two year service from September 2018.
- An additional 800 gardaí will be hired next year
- 500 civilian workers will also be recruited
- The Minister confirmed the State would launch a Brexit loan scheme for SMEs
- Up to €300 million will be made available at a ‘competitive rate’
News Team Budget 2018, taxes, vat