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WELFARE INCREASES, A rise in carbon tax and a jump in the standard cut-off rate for income tax – these are just some of the things we can expect in October’s Budget, according to Leo Varadkar.
In place of a stage-managed bumper announcement in October (and December before that), Budgets have now become a drip-feed of information beginning earlier and earlier each year.
This year is no different, with the Taoiseach using his pre-holiday briefing with journalists to drop a few hints about what might be coming in autumn.
As usual with kite-flying, mentions of the Budget during silly season (a time when there is a dearth of news for reporters, which the politicians know too well) should be taken with a massive pinch of salt. It is also worth noting that we are over two months out so this is all subject to change.
However, the Taoiseach does have the final say and here’s what he has in mind for Budget 2019 as of right now.
So, what can we expect?
The Taoiseach outlined a number of measures this week but, in short, he wants a balance of spending and tax cuts in October’s Budget.
Varadkar wants the majority of any additional cash to go into improving public infrastructure rather than tax reduction.
The programme for government has committed to a 2:1 ratio between spending on services and tax measures.
“We talked in the past about the proportion of 2:1 but it is going to be much greater than that. There will be a tax package, perhaps similar to last year – relatively modest,” he said.
Income tax
Varadkar said the government’s main focus for the next budget is on the standard cut off point for income tax and the point at which people start paying the higher rate, which is 40%.
Last year, changes to the rate were also made. The entry point for single earners being charged the higher rate of tax increased from €33,800 to €34,550, a rise of €750.
This means that anyone earning under €34,550 is now only charged the normal rate of tax, while those earning over it have seen a slight reduction in the tax that they pay.
The standard rate band for married one-earner couples rose from €42,800 to €43,550.
If Varadkar tinkers with the rate bands again, this will mean more money in a lot of people’s pockets.
Varadkar has said he does want to look at band rates again this year, stating:
People on very modest incomes pay the highest rate of income tax. The average person working full-time in Ireland – if you exclude students and people working part-time work – earns around €40,000-€45,000 a year.
Welfare
The Taoiseach said the government is also looking to increase welfare entitlements.
“In the welfare package in the budget we will be aiming to increase the weekly rates again. We don’t have a figure agreed by any means at this stage, but the aim is to increase it above the rate of inflation thus retaining the value of the current payments,” he said.
Last month, Social Protection Minister Regina Doherty said she plans to do something “significant” in the next Budget to pull thousands of children out of poverty.
However, she gave a strong indication there will not be a repeat of the €5 increase to all weekly social welfare payments across the board, which was announced in last year’s Budget.
When pressed about what drastic action she is planning in October, the minister said she has plans, but would not be sharing them just yet.
However, she added:
It’s not rocket science. We know the challenges that single income, low-income and no income families are facing on a daily basis and we just have to try and address this.
The Taoiseach indicated the government is keen to make improvements to the working family payment.
In terms of other social welfare payments, Varadkar said the government is working on proposals for “a form of Jobseekers [payment] for the self-employed“.
One issue that must be tackled by government is its abysmal climate change record.
In order to improve the country’s performance, the Taoiseach said carbon tax will have to increase over the next couple of years.
“We are also going to do some work on carbon tax. We are very much of the view that if we are going to meet our climate change obligations then we will have to grasp the nettle in increasing the carbon tax over the next couple of years,” he said.
Rise in carbon tax
While carbon tax will rise, the government will introduce compensation measures for some to offset the increase.
He said the government is aware that some people “who are in poverty or who are the most vulnerable can be the worst affected by that so there will have to be compensatory measures”.
Varadkar said he’ll also need to get the green light from Fianna Fáil for this proposal.
We will of course need to talk to the main opposition party about that and agree it at government but we think that [it] is necessary as part of our climate change obligations.
Ireland is falling far short of achieving its 2020, 2030 and 2050 climate change targets.
In a scathing annual report, recently published, the Climate Change Advisory Council said Ireland is in an “even worse position” compared to the previous year as greenhouse gas emissions increased again.
A carbon tax was introduced in Ireland in 2010. It applies to kerosene, marked gas oil, liquid petroleum gas, fuel oil, natural gas and solid fuels.
The rate is currently €20 per tonne. However, the Citizens’ Assembly was told during its sessions on climate change that Ireland would need to introduce a carbon tax as high as €70 on coal, turf and other products to improve emissions targets.
This could mean tax hikes on petrol and diesel, as well as on motor tax for some vehicles.
What else could we see in October?
Varadkar said the Minister for Social Protection is working on proposals for Budget 2019 around parental leave.
This measure will give additional parental leave, on top of the maternity and paternity leave options already in place. Varadkar said it will allow parents share paid leave between them.
Legislation for this is already being drafted, with the Taoiseach stating more details will be announced on Budget day.
Improvements to childcare provision could also be on the cards.
While the so-called “granny grant” might not be a runner (unless Shane Ross sets out clear criteria and enforcement measures), Varadkar indicated there could be improvements to the affordable childcare scheme.
Around 1,000 people could not avail of the scheme due to two department computers not being able to talk to each other, but the Taoiseach said that has all been ironed out with a new analogue system around the GP-access card.
He said the scheme will be fully operational next year.
What else can we expect? Keep an eye out for more kite-flying between now and October. The only guarantee is that they’ll be sighted regularly.
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so the Irish people that were trafficked weren’t trafficked…gotcha , I was beginning to wonder had that well known Leitrim to Donegal route kicked off again….
Keep allowing them in and soon enough it will be your daughters and granddaughters that Thell be grooming for sex. Not just yet, it’ll take more of them to live here before they get the courage, but it’s on its way, keep watching.
The people involved in this should be locked up for life ie 30 years plus
@Fjordie, the people involved in this will be out as soon as possible, this allows the legal industry to make more money off them the next time their caught, when again, they will be promptly released, and the legal industry continues to rake in the money, look at what happening now, people with up to 100 prior convictions being given suspended sentences, why, so the legal industry can make money from having their product in circulation.
Suspended sentences all round
change the record
Must have heard about the gravy train the you can go on after exploitation. #inbeforetheracists.
And the prize for most obnoxious troll goes to…
not to mention incoherent
What is conspicuously missing from this story is a very important question;
“How many of these children were in State “Care” when they were trafficked?”
We’ve had this conversation before, when it emerged that 500 went “Missing” from “Care”, but when the truth emerged it was found that the entire thing had been covered up by Gardai, the HSE and the government. The truth was that that we only found out because Wikileaks released diplomatic documents from the American Embassy in Dublin. While the government said they were “Missing”, the US State Dept. showed that most had been accounted for and were trafficked. Many of the children were found in brothels or enforced slavery.
You’ll have to pardon me for using quotation marks on the word “Care”. I wonder will Wikileaks have to step in again to find out how many of these children were in State “Care”?
So true.
Ireland is not known as the Hub of child trafficking for nothing.
Yes children in care are prostituted out- but the state never prosecutes itself.
No one in power wants to know and use excuses like – secret court rules, blahhhhhh,blahhhhh
The Immigrant Council yet again calling for ”the criminalisation of the purchase of sex”, completely ignoring the fact that coercive trafficking and commercial sex work are entirely different things. Amnesty, UNAIDS, The World Health Org and as of today the UK Home Office Select Committee all advocate decriminalisation but apparently the ‘experts’ of TORL, ICI & Ruhama know better.
Thanks lily ☺
Not a bother. Negative attention is still attention right? Lap it up pet.
your talking to me aren’t you? you realize you don’t have to? lol
@Lily, their beliefs and culture are not compatible. What would you say to anyone of the women who were abused/raped in Europe, or to the countless children, what you say to the mother of the young boy who was raped in a public swimming pool in Europe only to be told that the reason was the immigrant had a “sexual emergency”. And yes, our own countries have our own issues, but it’s committed by perverts, whereas it’s the accepted culture where these people come from.
Conri, Nowhere did I make any comment to suggest I condone violence or assault. You have done a marvellous job of reading subtext where there was none.
@Lily, As you have, no where did I say you did condone violence , you also have done a marvellous job of reading subtext where there was none, we’ve so much in common you and I. Actually I was just stating (as a comment in response to yours) that this is an incompatible culture and will lead us down a very dark path if something is not done to stem the flow, it’s been described as an invasion, I agree with this. Can you please respond to the following question: do you want to see some of our towns and cities end up like some of Britain’s, unrecognisable to English people, unsafe for them to venture into ?
have your say