Tax credits for renters and increased tax rate threshold part of Budget 2023

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Tax Credits For Renters And Increased Tax Rate Threshold Part Of Budget 2023 Tax Credits For Renters And Increased Tax Rate Threshold Part Of Budget 2023
Budget 2022, © PA Wire/PA Images
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Kenneth Fox

The Government will sign off on a large increase to the point at which people pay the top rate of tax to bring it close to €40,000, in the soon-to-be announced budget for 2023.

At present, the higher 40 per cent tax rate kicks in on income over €36,800 for a single person.

Minister for Finance Paschal Donohoe is set to raise this point by €3,200, with a similar increase for married couples or those in a civil partnership on one income.

It is also expected that there will be additional tax credits for renters of between €200 and €400, with the final amount yet to be agreed.

As the Irish Examiner reports there will be a 50-cent excise hike on a pack of 20 cigarettes, but it has been confirmed that there will be no changes to alcohol excise.

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The current cut in fuel excise will be extended to February at least, and it is likely to be extended beyond that.

On the Universal Social Charge (USC), the only move likely will be to ensure minimum wage increases don’t negatively impact low-income earners.

The help to buy scheme, which helps first-time buyers purchase a newly-built house or apartment and which was due to end in December, is to be extended.

The scheme applies to once-off self-build homes and only applies to properties that cost €500,000 or less.

In light of an exchequer surplus of €4.4 billion, Government sources have made clear that the rainy day fund is to get €1 billion at least.

The €3 billion plus cost-of-living package is to include electricity credits amounting to €600 per household, spread over two or three bills.

An extension to the 20 per cent reduction on public transport fares will also be agreed.

It is unlikely that the VAT cut for the tourism and hospitality sectors will be extended beyond February.

An increase in welfare payments is likely to be at least €10 per week, but a €20 increase has been ruled out by Minister for Social Protection, Heather Humphreys.

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