Budget 2019: Here’s everything that you need to know

Cigarettes, Social Welfare payments, and the minimum wage are going up.

As previously reported, the Budget has confirmed that social welfare payments have increased by €5 while the 100% Christmas bonus payment to all social welfare recipients will be fully restored.

Minister of Finance Pascal Donohue has delivered the Budget and for smokers, there’s going to be a 50 cent increase on a 20 pack of cigarettes.

The hourly minimum wage will be increased to €9.80 and the weekly threshold for the higher rate of employer’s PRSI will be increased from €376 to €386.

#Budget19 pic.twitter.com/pbwweKZLeX

— Department of Finance (@IRLDeptFinance) October 9, 2018

With regards to affordable housing, Minister Donohoe said that the Government are increasing the planned funding from €20 million to €89 million in 2019. This is expected to facilitate the delivery of around 6,000 affordable homes.

He said: “The infrastructural funding available per subsidised home is also being increased from €40,000 up to a maximum of €50,000, supporting the delivery of homes at up to 40% below market prices. Income eligibility limits of €50,000 for a single applicant and €75,000 for dual applicant households will apply and these will be kept under regular review to ensure they remain appropriate.”

€1.25 billion for the delivery of 10,000 new social homes has also been allocated while an extra €30m has been assigned for homeless services.

From November onwards, there’s going to be an extra two weeks paid paternal leave introduced too.

Minister for Finance Paschal Donohoe has delivered the first balanced Budget since 2007 and here are the main learnings – as per the relevant categories.

Housing

• €2.3 billion to be spent in total on housing programmes.
• €1.25 billion will be allocated for the delivery of 10,000 new social homes in 2019.
• The Government are in discussions with various State bodies in relation to land that could deliver another 7,000 homes.
• There will be an extra €121 million given to the Housing Assistance Payment (HAP) in 2019 to provide an additional 16,760 new tenancies.
• €60m for emergency accommodation.
• Another €30m for homeless service.
• An Affordable Housing Scheme will see subsidises of up to €50,000 per house. Over the course of three years, the scheme aims to deliver 6,000 homes to be sold at up to 40pc below market price.
• With regards to renting, the restriction on the amount of interest that may be deducted by landlords in respect of loans used to purchase/improve/repair their property, will be brought forward .The rate was due to be 100 per cent by 2021 but will now be effective from 1 January 2019.
• The inheritance tax threshold for children receiving property from their late parents is to rise by €10,000 to €320,000.

Housing Budget for #Budget19 pic.twitter.com/76CpxdExLm

— Eoghan Murphy (@MurphyEoghan) October 9, 2018

Health

• 50 cent increase on 20 pack of cigarettes. This will bring the standard price to around €12.70.
• There’s also an increase in the Minimum Excise Duty on tobacco products so all cigarettes sold below €11 will have the same excise applied as cigarettes sold at €1.
• €1.05 billion increase in overall health funding for 2019.
• 100,000 new free GP visit cards.
• 50 cent reduction from €2.00 to €1.50 on prescription charge drugs for over 70s.
• €10 reduction in monthly Drugs Payment Scheme threshold.
• An extra 84 million will be allocated to Mental Health funding.

pic.twitter.com/q2VhtG532u

— Dept of Public Expenditure NDP Delivery & Reform (@IRLDeptPER) October 9, 2018

Social Welfare

• All social welfare payments will increase by €5 from March 2019.
• The 100% Christmas bonus payment to all social welfare recipients this year will be fully restored.
• Two extra weeks paid paternal leave will be introduced in November.
• €25 increase in both Back to School Clothing and Footwear Allowance rates.
• Increases to the Qualified Child Payment of €2.20 per week in respect of under 12s.
• The income thresholds for the Affordable Childcare Scheme will increase next year. Maximum income threshold will go up from €47,000 to €60,000 (after tax)

pic.twitter.com/HHOdhzOI8w

— Dept of Public Expenditure NDP Delivery & Reform (@IRLDeptPER) October 9, 2018

Public expenditure

• There will be a provision of €110 million for Brexit measures made available across all departments.
• GDP is forecast to grow by 4.2% for next year
• A ‘rainy day fund’ will be “capitalised with €1.5 billion from the Ireland Strategic Investment Fund and supplemented with an annual contribution of €500 million from the Exchequer starting from 2019.”
• €59.2 billion will be allocated to current expenditure with an extra €1.4bn being spent on Garda stations, schools and hospitals. This represents a 4% increase.
• €320m to be invested into Dublin Airport and €587 million euro to be invested in Dublin, Shannon and Cork ports.

Education

• €10.8 billion has been allocated to the Department of Education and Skills.
• There will be an extra 950 Special Needs Assistants in schools next year.
• The amount of money given to school for their day-to-day operation is to rise by 5pc next year.
• Funding is also being provided for 1,300 additional posts in schools.

Business, enterprise and corporate taxation

• €950 million to the Department of Business, Enterprise and Innovation in 2019.
• €110 million for Brexit measures across a number of Departments.
• The 12.5% corporate tax rate will not be changing.
• As of midnight tonight, an Exit Tax will apply at a rate of 12.5% for any company that aims to move their assets offshore.

#Budget19 pic.twitter.com/VLUp8BeKuE

— Department of Finance (@IRLDeptFinance) October 9, 2018

https://twitter.com/IRLDeptFinance/status/1049649905923428354

Infrastructure (roads, airports, transport)

• €286 million extra funding will allow investment in new transport infrastructure.
• This funding has been confirmed for: 1) N4 Collooney to Castlebaldwin and the Dunkettle Interchange, 2) Completion of runaway overlay project at Knock Airport, 3) design and build of cycling and walking projects around the country.
• €40m has been assigned for “pavement repair and rehabilitation works on regional and local roads”.

Tourism and media (Film, Newspapers)

• VAT in the tourism sector will rise to 13.5% from January 2019 – these funds will be used to help build housing and they will also be put toward education costs.
• The 9% tax rate for newspaper publications has been retained. The rate for electronic publications has fallen from 23% to 9%.

Energy 

• 1% surcharge for diesel vehicles to apply across all VRT bands.
• With regards to Carbon Taxes, there won’t be any immediate increases to coal, petrol, diesel etc.

Agriculture and defence

• Garda budget is to go up by €60m (3.5pc) next year. This will allow for the recruitment of 800 new gardaí.
• An additional €57 million of current expenditure to the Department of Agriculture, Food and the Marine in 2019.
• €29 million for infrastructural development across Army, Air Corps and Naval Service.
• Overseas aid is set to increase by almost €110 million.

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