Budget 2017 has been announced with lots of figures and long winded words that’s difficult to comprehend. But what exactly does it mean for Ireland?

Housing

The Government has announced 1.2bn increase in spending in housing as part of Budget 2017. Included in this announcement is the provision of 47,000 social housing. The government is hoping to meet the needs of 21,000 social applicants by next year.

€100 million will also be spent on emergency accommodation for homeless people.

There will be an additional investment of €105m in the Housing Assistance Payment. Rebates of up to €20,000 will be available for first time buyers but they must be taking out a mortgage for at least 80 per cent of the purchase price.

The Mortgage Interest Relief scheme will be extended beyond 2017.

The Home Renovation Initiative which gives homeowners renovating a tax credit will also be extended until 2018.

Rent room relief will be increased and carry a higher tax ceiling of 14,000 from a previous 12,000. From this it is hoped to give homeowners an incentive to let rooms in their homes. From this the government also hope to tackle the issue of student accommodation shortage.


Taxes

Tax changes for Budget 2017 will all mostly be decreases and favour all income earners. Budget 2017 will carry 500m worth of tax cuts.

Income Tax will remain the same but there will be a change in the USC Charge

The three USC brackets will be reduced by 0.5 per cent.

-1 per cent will go down to 0.5 percent

-3 per cent rate will be reduced to 2.5 per cent

-5.5 per cent bracket will be reduced to 5 per cent

DIRT tax will be reduced by 2 per cent each for 4 years. The results will be a reduction in DIRT Tax to 33 per cent in 2020.

There was much speculation of increase in fuel tax on Diesel to bridge the gap between Diesel and Petrol but this was dropped according to reports because of Brexit.

The only tax increase on consumer products in this budget will be cigarettes which will rise by 50c.

Also there will be an introduction of tax on sugar. It will be implemented in 2018 and will be similar to UK.

 

Health

Budget 2017 will see the most money being spent on the health sector, in the state’s history.

An investment of additional 497m in the health sector will bring total spending in health to 14.6bn.

€25 cap on prescriptions for over 70’s will be reduced to €20.

15 million euro will be added to the National Treatment Purchase Plan which is hoped will reduce waiting lists.

Children that are in receipt of domiciliary care allowance will automatically receive a medical card.


Public Services

There will be 2,400 extra teaching posts of which 900 will be resource teachers.

Higher and further education sector is to get an investment of €36.5 million.

800 new Gardai will be recruited.


Social Welfare

Weekly Social Welfare payments will increase by €5, will also include a Christmas bonus of 85 per cent for 2016.

State pensions rise by €5 per week.

 

 

As you can see from this Budget it is clear that the government have spent most money on housing and health. These two sectors are the most poorly performing sectors in the country at the moment. The government hopes from investment in these sectors that there will be a significant improvement.


It is widely reported that middle income earners and first time buyers will gain the most from Budget 2017. One of the worst groups reported to be hit in this Budget is the minimum wage workers.