Budget 2022: Here's what you need to know

Ministers Paschal Donohoe and Michael McGrath have announced a budget package for the coming year...
Jack Quann
Jack Quann

14.29 12 Oct 2021

Share this article

Budget 2022: Here's what you n...

Budget 2022: Here's what you need to know

Jack Quann
Jack Quann

14.29 12 Oct 2021

Share this article

Ministers Paschal Donohoe and Michael McGrath have announced a budget package for the coming year, worth €4.7bn.

This is split between expenditure measures of €4.2bn, and €500m worth of tax measures.

Half price public transport for young people, a large increase in the number of Gardaí and subsidies for childcare are among the biggest measures.


The main weekly welfare payments, including the State pension, are to rise by €5 a week - along with the weekly fuel allowance.

The point at which people start to pay the higher rate of tax will go up by €1,500.

While carbon taxes increase from midnight - meaning petrol, diesel, coal and home heating oil will be more expensive.

Here are the main provisions of Budget 2022:


  • A €5 weekly increase for all social welfare recipients
  • The weekly fuel allowance is to increase by €5 from tonight
  • The Christmas bonus will be paid in full for 2021
  • The State pension will increase by €5
  • An extra €3 will be added to the Living Alone Allowance
  • More carers will qualify for payments in the first major reform of the Allowance in over a decade
  • A COVID-19 contingency fund is being created and includes €500m for testing and tracing, a vaccine booster campaign and PPE
  • EWSS scheme extended in a graduated form until April 30th 2022
    - No change to the scheme in October and November
    - In December, January and February a two-rate structure of €151.50 and €203 will apply
    - In March and April 2022 a flat rate of €100 - a reduced employers PRSI will no longer apply
    - Scheme to close to new entrants from January 2022
  • The earnings limit on Disability Allowance will rise from €350 to €375

Parents and families

  • The Back to School Allowance will go up by €10
  • Parents Benefit to increase to seven weeks from July next year
  • Plans to freeze childcare fees have been unveiled
  • Free GP care will be given to children aged six and seven - with plans to extend it to those up to 12 years
  • New funding stream for 4,700 childcare providers from September 2022
  • The pupil-teacher ratio in primary schools will be reduced by one point


  • The lower tax band of €35,300 will rise by €1,500
  • A €50 rise in the personal tax credit
  • The ceiling for the second band of USC is rising to €21,295
  • The USC exemption for medical card holders and those over-70, earning less than €60,000, stays in place
  • Carbon tax will rise by €7.50 per tonne - increasing the price of natural gas, bag of coal and bale of briquettes
  • The cost of a full tank of petrol will go up by €1.28 and the diesel will go up by €1.50
  • The VRT exemption for Battery Electric Vehicles is to be extended to the end of 2023
  • A revised motor tax system from January will see:
    1% increase in VRT for bands 9-12
    2% increase for bands 13-15
    4% increase for bands 16-20
  • Reduced VAT rate of 9% for hospitality sector will remain in place until August 2022

Cost of living

  • The minimum wage is rising by 30c to €10.50 an hour
  • The price of alcohol will be unchanged - 50 cent will be added to the cost of a pack of cigarettes from midnight
  • A pilot scheme is being introduced to provide a basic income for artists
  • The live events sector is to get €25m in supports
  •  €25m for a new Youth Travel Card, which will see 50% discount on public transport for those aged 19-23


  • Core health spending is to increase by €1bn, to a record €20.38bn
  • 8,000 new posts to be created across the health system
  • Free contraceptives for women aged 17-25 from next August
  • There is a €250m package to shorten waiting lists
  • €105m for disability services
  • A package on domestic and sexual violence, including extension of legal aid for victims and funding awareness campaigns


  • Working from Home employees can claim back 30% of vouched expenses for heat, electricity and broadband
  • An extra 800 Gardaí will be hired and 400 civilian staff
  • An extra 980 teachers and 1,165 new Special Needs Assistants (SNAs) to be taken on
  • €6.7m for a Youth Justice Strategy to tackle anti-social behaviour


  • €202m is to be spent on retrofitting homes, which will support 22,000 energy upgrades
  • The Help-To-Buy scheme will be retained for 2022 at current rates with a 'full review' next year
  • A Zoned Land Tax to encourage the use of land for building homes - this will apply to land zoned suitable but undeveloped
  • New mica redress scheme to be announced 'in coming weeks'

Follow our live blog for all the updates and reactions

Share this article

Read more about

Budget 2022 Budget Package Michael McGrath Paschal Donohoe Tax Cuts What You Need To Know Youth Travel Card

Most Popular