Budget 2024 delivers cash boosts, tax cuts and free electricity for thousands

Cash boosts, tax cuts and free electricity for thousands are among the highlights of the newly announced Budget 2024. 

Details of next year's Budget were delivered this afternoon (Tuesday October 10) by the Minister for Finance, Michael McGrath, and the Minister for Public Expenditure and Reform, Paschal Donohoe. 

Addressing the Dáil, Minister McGrath described the "enormous privilege" of delivering the Budget. 

He emphasised the importance of continued investment in infrastructure, the importance of Ireland's enterprise economy, and the need to offer "opportunity for all and a safety net for those who need it". 

Here are all the details revealed in Budget 2024: 

Tax and income 

A reduction in USC (Universal Social Charge) from 4.5% to 4% has been confirmed, marking the first reduction in five years.

The USC was introduced in 2011 as an effective levy on wages as Ireland recovered from the 2008 financial crash, and it has been maintained by every government since then. 

Income tax bands have risen once again in a bid to tackle the ongoing cost of living crisis. 

The 40% tax band has increased by €2,000 to €42,000, following increases in 2023 and 2022 as well. 

As of January 1 next year, the minimum wage will increase by €1.40 to €12.70 per hour.

According to Minister McGrath, a full time worker will see a net income increase of approximately €2,300 on an annual basis. 

Employee PAYE and earned income tax credits will also increase by €100 each for 2024. 

Additionally, the Government will launch an extensive public information campaign with Revenue to explain all the tax and income reliefs people can avail of. 

During his speech, the Minister said, "Many people do not fully claim all the tax relief they are due." 

"Tax reliefs by their nature are complex, I am determined to ensure all businesses, especially small and medium sized businesses, know what they are entitled to claim and can access all appropriate schemes and reliefs." 

Social welfare

The ministers have confirmed all social welfare rates will increase by €12 per week. 

Regular social protection recipients including pensioners, jobseekers and carers will receive a Christmas bonus in early December. 

A once-off double week separate to Christmas will be paid to recipients in January. 

Double child benefit to the value of €140 per child will be paid to all households before Christmas, while a €400 lump sum will also be paid to recipients of the Working Family Payment later this year. 

Two hundred euro extra has also been announced for people availing of the Living Alone Allowance, with €242 for homeless services. 

Families 

A 25% reduction in childcare costs will take effect from September 2024 under the National Childcare Scheme. 

A €10 increase in the monthly rate in Domiciliary Care Allowance has also been announced, as well as a €54 per week rise in the Working Family Payment. 

Additionally, the Hot School Meals Programme will be extended to a further 500 primary schools in April 2024. 

The Incapacitated Child Credit has also increased by €200 and a Child Benefit double payment will be available in December. 

In an effort to recognise the "wider familial relationships that foster children have with foster parents", changes to inheritance and gifting rules have also been amended to ensure foster children can avail of same. 

Education 

Minister Donohoe confirmed the allocation of €10.5 billion to the Department of Education in 2024, with a capital budget of €940 million.

He said, "This is to facilitate the continued roll out of urgently needed school building projects, including 300 building projects already underway." 

He confirmed a further 200 buildings will commence construction over the course of 2024 and 2025. 

Over 740 additional teachers to support those with special education needs in special schools and mainstream settings has also been announced, as well as 1,400 additional Special Needs Assistants (SNAS). 

He said, "This will be the highest number of SNAs we've ever had in our education system, providing additional resources to special schools to support them in the vital work they do in supporting our most vulnerable students." 

The minister also confirmed the extension of the Free School Books Scheme to all Junior Cycle students from September next year. 

This will reportedly benefit over 200,000 pupils. 

Fuel and energy 

As the cost of living crisis continues to hurt the pocket of people across Ireland, the Government has announced a €300 lump sum payment to Fuel Allowance recipients. 

Large jumps in cost of living measures were not expected in the Budget this year, following the announcement of last year's three €200 energy credits and overall cost of living package worth €4 billion. 

However, three similar credits of €150 have been announced; one of these will be paid before Christmas, with two more expected in spring. 

To combat rising fuel prices, the Government has also announced the deferral of the final tranche of the petrol and diesel excise duties. 

Petrol and diesel will instead increase in two installments on April 1 and August 1 2024. 

The 9% VAT rate for gas and electricity has also been extended for 12 months. 

Rent and Mortgage relief 

Minister McGrath cited the "exceptional" past 14 months and "ten successive interest rate increases" as a reason for mortgage relief measures announced in Budget 2024. 

According to the minister, relief will be available to approximately 165,000 mortgage holders with a balance of €80,000 and €500,000 as of December 31 2022.

He confirmed mortgage relief of 20% on the increased interest rates, capped at €1,250 per property. 

Additionally, the Rent Tax Credit will increase in value from €500 per year to €750 per year in 2024. 

Parents who pay for their student children can also claim the tax credit, which will be backdated to allow for claims to be made for the 2022 and 2023 tax years. 

The Help-to-Buy Scheme - which is due to be amended so that more people can avail of it - has also been extended to the end of 2025. 

Cigarettes and booze

Another price hike on cigarettes has been confirmed, with a 75 cent increase (due to take effect from midnight tonight) on a packet of 20. 

The cost of a standard packet of 20 cigarettes in the most popular price category will rise to €16.75, up from €15.50 last year. 

According to Minister Donohoe, a domestic tax on e-cigarette products will also be introduced in next year's Budget. 

Housing 

An extension of the Help-to-Buy scheme has been confirmed to the end of 2025. 

Minister McGrath also stated changes may be implemented next year if required. 

An amendment to the Help-to-Buy scheme has also been confirmed to help people on the Affordable Purchase Scheme who don't qualify under Help-to-Buy. 

Small-time landlords have also benefitted from Budget 2024. 

According to the minister, 86% of landlords own just one or two rental properties. 

He said, "There has been a decline in the number of small investors in the market owning one or two properties, they have a vital role to play."

Landlords with rental income of €3,000 for 2024, €4,000 for 2025 and €5,000 for the years 2026 and 2027 will be disregarded at the standard rate of income tax.

However, properties must remain in the rental market for the full four years or relief will be clawed back. 

The Department of Housing's budget will be just under €7 billion for 2024.

Sinn Féin's Finance spokesperson, Pearse Doherty, criticised the housing measures announced by the Government as "a failure". 

Culture 

The VAT on audiobooks and eBooks (currently 9%) has been amended to 0% VAT from January 1, 2024. 

The threshold on donation of heritage items will also increase from €6 million to €8 million. 

Minister McGrath said it was "vital" to promote Irish culture to audiences "at home and abroad". 

He confirmed an increase in current project caps on qualifying Film Tax Credits from €70 million to €125 million subject to State aid approval. 

Businesses 

"Indigenous businesses are the backbone of the economy." 

That's according to Minister McGrath, who confirmed an increase in Research and Development (R&D) Tax Credit from 25% to 30%, with a doubling in the first year payment threshold from €25,000 to €50,000. 

The R&D tax credit is a valuable tax-based incentive that is designed to encourage investment in R&D by companies in Ireland. 

New targeted Capital Gains Tax Relief has also been confirmed for angel investors starting up SMEs (Small and Medium sized Enterprises). 

Other

Information on two new funds - Future Ireland and the Infrastructure Climate and Nature Fund - was also revealed today. 

The Future Ireland fund will provide for €100 billion for public services, with €14 billion for the Infrastructure Climate and Nature Fund.

Minister McGrath stated, "The new savings fund, the Future Ireland Fund, is not a rainy day fund. It is for costs we know are coming our way in the years ahead, and will benefit all of us, the people working today and future generations. 

"It will help us to meet the cost of running the state in the future. And it will make a contribution to the cost of health care of pensions, home care and much more." 

He continued: "I am announcing that we will invest 0.8% of GDP annually into the future Ireland fund from 2024 to 2035. This will be a sum of approximately €4.3 billion in 2024.

"In addition we will transfer seed funding of just over 4 billion euro into the fund next year from the distribution of the current national reserve fund. It is expected that with a funding level of 0.8% of GDP annually, the fund could potentially reach a total of €100 billion by 2035." 

The Infrastructure Climate and Nature Fund will aim to ensure there is no reduction in capital investment when the economy experiences a downturn, with funds also set aside for climate and nature related capital projects.