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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


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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.

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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:

Welfare

  • 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

Taxes

  • 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

Health

  • 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

Work

  • 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

Housing

  • €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


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