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Budget 2023 – Over ten billion euro in budget measures announced to tackle cost of living

The measures are designed to help young families, students and the vulnerable

A giveaway budget worth more than €11bn has been given this afternoon as the government bids to battle the soaring cost of living.

There are measures designed to help young families, students and the vulnerable with core social welfare rates to rise and lump sum payments planned before the year is out.

The cost of one-off measures in the budget will be €4.1 billion, core budget measures of €6.9 billion, making a total budget of €11 billion.

Here are the main headings:

Excise rate reductions of 21 cent on petrol and 16 cent per litre and 5.4c per litre in Marked Gas oil, 9% VAT rate. for electricity and gas extended until 28th February 2023.

Pack of 20 cigarettes up 50c and pro-rata increase on other tobacco products.

Fuel allowance lump sum of €400.
Income threshold for fuel allowance will increase from 120 to 200 above state pension.
The weekly fuel allowance means limit to €500 for single person and 1000 for a couple over 70.

Lump sum cost of living double social welfare payment in October.
12 euro across the board increase in social welfare.

25% reduction in the cost of childcare under the national childcare scheme at cost of €121m.
Will save up to 175 a month for families.

The Christmas bonus is confirmed.

€500 lump sum on the working family payment.
Double child benefit payment in November.
Working family payment thresholds up €40 a week.
Qualified child allowance up €2 a week.

€1.1bn income tax package.
€3,200 increase in the cut-off rate to higher tax to €40,000.
The main tax credits (personal, employee, earned income) are being raised by €75.
Minister signals a future move towards a third rate of income tax.
Further analysis to take place on a new third rate of income tax with review published before next year’s Summer Economic Statement.
Donohoe says significant lead in the time needed but could be done by Jan 2024.

The second USC rate band (2% rate) will increase from 21,295 to 22,920 to take account of the minimum wage increase of 80c p/h.
USC concession for those with a medical card earning less than 60k is being extended for another year.

Home Carer Tax Credit is being increased by €100.
€500 payment for carers and those with a disability in November.
€200 on the living alone allowance.
Domiciliary care allowance increased by €20.50.

Extending contraception to women aged 16 to 30.
Providing support for the first time for publicly funded IVF treatment.

Help to Buy extended at current rates until the end of 2024.

A new tax credit for renters of €500 a year confirmed.
400,000 people to benefit, which can be claimed for 2022 and 2023.

The pre-letting expenses for landlords is being doubled to €10,000 and the time a property must be vacant reduced from 12 to 6 months.

Vacant Homes Tax introduced.
Will apply to homes which are occupied for less than 30 days a year.
Will be charged at a rate three times the Local Property Tax for the home and will be self-assessed.

There will be a new Residential Zoned Land Tax.
Local authorities to publish draft maps in November.

The residential development stamp duty refund scheme is being extended to the end of 2025.

To pay for the Mica redress scheme a levy on concrete blocks, pouring concrete and some other concrete products.
It’s expected to be a rate of 10% from April 2023 and will raise €80m annually.

A carbon tax increase of €7.50 a tonne will go ahead as planned on October 12th.
Will put up petrol and diesel by 2c a litre.
However, the Government is reducing the National Oil Reserves Agency levy to 0% to offset the cost.
This is worth 2c a litre.

Five tax reliefs will be extended.
Young trained farmer and farm consolidation stamp duty reliefs, farm restructuring CGT relief, young trained farmer and registered farm partnership stock reliefs.

Accelerated capital allowances for building modern slurry storage facilities.

TBESS scheme from Revenue to help businesses which will give back 40% of increased cost of electricity bill.
Monthly cap of €10,000.
Will be calculated by comparing average unit prices from 2021 to 2022.

€100m for schools to deal with energy costs.
€10m for third-level institutes.

Companies will be allowed to give employees €1,000 tax-free a year in vouchers, up from the current €500.

50% excise relief to small independent producers of cider.

Halving of the cost to apply for a Special Exception Order for late-night venues.
Down from €110 to €55.


€1000 euro reduction in the student contribution.
Double payment of SUSI grant.
1,000 euro increase to postgrad fee contribution grant.
Reduction in student fees of 500 euro.
Increase of between 10% and 14% in student grant.
Postgrad grant will increase by 500 euro.

686 additional teachers to support those with special needs.
An additional 1,194 SNAs bringing the number to 20,300.
Reduction in the pupil-teacher ratio by 1 point to 23:1 with 370 extra teaching posts.
Funding for free school books for all primary school pupils.

9% VAT rate on hospitality will continue until 28th Feb 2023
So it will go to 13.5% after that

VAT on newspapers reducing to 0% from Jan 1st 2023.

VAT on defibrillators reduced to 0% from Jan 1st.

0% of VAT will apply to hormone replacement and nicotine replacement therapies.

Ireland to be part of EU windfall tax approach but will go it alone if needed.

Bank levy extended for another year to raise 87m per annum.

Two billion euro going into the Rainy Day fund this year.
Four billion in 2023.

600 euro electricity credit for all households.
First payment before Christmas and two in the new year.

Tune into KCLR between 4 pm and 6 pm on Tuesday for a live budget 2023 special show.