Budget day tax changes worth about €830 a year for single person earning €55,000

The biggest day in the political calendar is here.

Outside Leinster House gardaí are planning a “mini-sterile zone” in a bid to thwart any attempt by protesters to disrupt the work of the Dáil.

Inside the building, Minister for Finance Michael McGrath will stand up in the Dáil to introduce Budget 2024 at 1pm.

He will focus on the tax changes, to be shortly followed by Minister for Public Expenditure Paschal Donohoe detailing the spending measures.

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As our Political Editor Pat Leahy reports, the overall size of the budget will be around €13 billion.

That includes spending increases and tax cuts worth over €9 billion – that gives almost €2.5 billion in cash back to voters in the coming months – and €4 billion in “non-core” spending on areas such as housing for Ukrainian refugees and post-Covid spending in health.

What does it all mean for individuals?

Irish Times columnist Cliff Taylor has crunched some numbers and reckons the expected tax changes will be worth around €830-a-year for a single person earning €55,000.

People who qualify for special credits – such as the rental credit which is expected to go up to a sum of around €750 – would gain more.

Similarly, mortgage holders whose repayments have soared with European Central Bank rate rises, could also receive tax relief of up to €1,250.

Household income more generally will be pushed up by measures such as the three energy credits expected to come to a combined total of €450 and a double month of child benefit before Christmas.

There will also be a €12 a week increase in basic welfare rates including pensions, though, as Leahy writes, this is far less than that sought by campaigners.

New funds for climate action, infrastructure and long-term savings will also be part of a huge spend and save budget to be unveiled by the Government.

This includes a new €3 billion “war chest” to invest in climate and nature restoration projects over the remainder of the decade.

A new savings fund will benefit from the rest of the windfall corporation tax receipts, and will be in addition to the existing €6 billion “rainy day” fund previously established by the Government.

Taylor writes more about the planned investment funds here.

Elsewhere, Jack Horgan-Jones provides a comprehensive round-up of what is known about the contents of the budget prior to McGrath and Donohoe unveiling it in the Dáil later.

This includes a “modest” tax break for landlords, the details of income tax relief and USC cuts and how parents of young children can expect a further 25 per cent cut to childcare fees, though it is unclear exactly when in 2024 it will be introduced.

For those with older children the free school books scheme is set to be extended to the first three years of secondary school and there will be cuts to third-level fees of between €1,000 and €1,500 depending on a household’s income levels.

Horgan-Jones also profiles Michael McGrath, with one Fianna Fáil observer suggesting “he’s been practising this speech for a long time.”

Stay glued to the Irish Times website for rolling budget updates throughout the day. Full details of our coverage of Budget 2024 are here.

Best reads

Away from domestic politics, war in the Middle East dominates the headlines today. Mark Weiss reports that Israel’s prime minister Binyamin Netanyahu has warned that his country’s response to Saturday’s attacks by Hamas militants would “change the Middle East”. He said: “What Hamas will experience will be difficult and terrible: we are already in the campaign and we are just getting started.” Israel is set to impose a total siege on the Gaza Strip. More than 500 people have been killed and at least 2,500 injured in Gaza since Israel began striking the coastal enclave in retaliation for the attack by Hamas in Israel that began at the weekend and has killed at least 900 people.

Naomi O’Leary and Harry McGee report on how the Irish Government is to challenge European Commissioner Oliver Varhelyi’s unilateral announcement that all payments of aid to the Palestinian territories would be “immediately suspended” as a result of the Hamas attacks on Israel.

Elsewhere, Conor Gallagher reports that Irish-American entrepreneur Chuck Feeney, whose philanthropy provided nearly €2 billion in funding to Irish causes, has died at the age of 92.

Meanwhile, Labour Cork East TD Seán Sherlock has announced he will not be contesting the next general election saying it was a “difficult decision” that he has made with a “heavy heart”.

He is the second Labour Party TD in recent days to announce they will not run in the next election after Wexford TD and former minister and party leader Brendan Howlin did so on Friday. Mr Sherlock had been grappling with whether or not there was a future for him in politics in the wake of the Electoral Commission’s constituency review that will see his Mallow support base moved to Cork North-Central. We look at how the Labour Party always had a battle on its hands to maintain or increase its seven TDs and how the impending departure of Howlin and Sherlock does not make things any easier.

Playbook

The Budget Day action in the Dáil kicks off at 1pm with the speeches by Minister for Finance Michael McGrath and Minister for Public Expenditure Paschal Donohoe.

This will be followed by statements by the Opposition with Sinn Féin’s finance spokesman Pearse Doherty expected to lead the charge in attacking the Coalition’s plans.

Seven hours of debate will halt for a break at 8pm.

The Dáil will resume again at 8.30pm for financial resolutions and votes on any budget measures due to start immediately such as changes to excise on packs of cigarettes.

Proceedings are scheduled to adjourn at 12.30am on Wednesday.

The Seanad starts at 11.30am with “Commencement Matters” – an opportunity for Senators to raise issues of concern at the start of each sitting day.

There will be statements on the budget in the Upper House from 6.30pm.

The Committee on Assisted Dying will hear from witnesses on the topic of end-of-life care from 10.30am.

Representatives of the Central Statistics Office and Residential Tenancies Board will be before the Committee on Housing on the topic of “Analysis of Private Rental Sector Discrepancies” from 4pm.

The full Dáil, Seanad and committee schedules can be found on the Oireachtas website.