Budget 2023: How possible measures could affect people who earn less than €60,000 a year

As the nation faces a winter of dissatisfaction with rising energy, food and other costs, Taoiseach Micheál Martin has promised that the upcoming March 27 budget will

His budget this year will be two-pronged. The budget package itself will cost 6.7 billion euros, while a separate one-off living expenses package is expected to cost more than 1.5 billion euros.

So what’s in store for families and individuals earning less than €60,000 a year?

tax cuts

Tax cuts that would cost a total of 1.8 billion euros are being considered by the government.

Ministers are considering increasing standard income rates by €2,500 and raising personal tax credits from €100 for single people to €1,800 and from €200 for married people to €3,600.

The PAYE balance can also be increased by €100 from €1,700 to €1,800.

Tánaiste Leo Varadkar has promised tax cuts that would help the “squeezed” middle earners the most. However, whether the government will implement its proposal for a middle-income tax rate of 30 percent remains to be seen on budget day.

“The most important thing is that middle-income people will see a significant reduction in the income tax they pay,” Mr Varadkar said earlier this month.

Increase in minimum wage and sick leave

The national minimum wage will increase by 80 cents an hour to €11.30 from January 1, 2023, which would put an additional €1,600 in the pockets of those working full-time for the minimum wage over the next year.

Mr Varadkar said such an increase would be larger than any increase in welfare rates in the budget.

He also said that a new sick leave law would come into force in 2023, giving almost all workers in the state the right to sick pay of up to €110 a day and would apply to about 164,000 workers. However, unions have criticized waiting until next year to sidestep the new law, which was originally due to come into force this month.

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Gasoline and diesel prices have risen significantly compared to the previous year.

Gasoline and diesel costs

The government is considering extending the 9 percent excise tax cut on petrol and diesel, due to expire at the end of this year, for a further six months to offset rising fuel costs.

energy bills

Cabinet has been warned families could face astronomical annual bills of €6,000 a year on gas and electricity next year, an increase of around €2,000 for the average household, which currently spends around €1,800 a year on gas and €2,200 a year electricity pays.

Ministers are considering a €200 energy credit to be applied directly to bills that would be paid three times a year to help prevent many families from falling into energy poverty.

Taoiseach Micheál Martin said he favored more direct support for households to cover their energy bills, rather than introducing a UK-style price cap or a windfall tax on corporate profits.

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Fares have been reduced over the past year and could fall further or stay the same

Public transport

Public transport fares were cut by 20 per cent earlier this year as part of the first cost-of-living package and it appears the reduction will stand or be cut further in the budget.

education

Third-level student fees could be reduced by up to €250 per year if students pay €3,000 per year in tuition.

social care

The ministers are considering a one-off doubling of child benefit to EUR 280 for one child, EUR 560 for two children and EUR 840 for three children.

Also planned are a one-off doubling of social assistance and working families, as well as a 100-euro lump sum for fuel money recipients and an expected increase in social assistance by around 15 euros per week.

A one-time double payment of the statutory pension, unemployment benefit, care allowance and disability benefit is also being considered, which is expected to be paid out in addition to the annual Christmas bonus for all social welfare recipients.

landlords and tenants

With many landlords exiting the rental market and rising house prices exacerbating the housing crisis, the government is considering lowering the tax landlords pay on their rental income.

The government is also considering a tax credit for renters.

https://www.independent.ie/business/personal-finance/budget-2023-how-possible-measures-could-impact-people-earning-under-60000-a-year-41995197.html Budget 2023: How possible measures could affect people who earn less than €60,000 a year

Fry Electronics Team

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