Budget 2024: What We Might Expect

With a budget surplus predicted for next year the government must play a balancing act to discourage inflation, alleviate the strain of the cost-of-living crisis and, with an election coming up next year, they need to keep voters on their side.

While the Minister for Finance, Michael McGrath, is keeping his cards close to his chest there has been much reported in the media around the following areas that may affect our client base:

 

Small Landlords

With the ongoing housing crisis there has been considerable discussion around landlords, and many are pushing for a tax break for small landlords to encourage them to stay in the rental market. 

The Minister for Housing, Darragh O'Brien, has been quoted several times saying he is recommending a tax break for small, non-institutional landlords, but without giving any specifics as to what form the tax break will take.

 

Employers 

It is expected that the minimum wage will be increased in Budget 2024 but we do not know yet by home much. The national minimum wage in Ireland is €11.30 per hour.  If it is increasing by 12 per cent - double the predicted rate of inflation for this year – the minimum wage would increase to €12.65 per hour. This would put pressure on some employers particular in businesses that are already struggling due to increased energy costs. There have been calls to keep the minimum wage increase to 5% which would lessen the impact somewhat. 

 

Small Businesses

There has been some talk that the Keep Scheme may be reformed, renewables incentivisation or changes to the R&D Tax Credit but there are no concrete plans. 

We echo the sentiment of The Small Firms Association (SFA) who called for the government to “tackle the increasing costs of doing business in Ireland” and “support small businesses to stay ahead in a rapidly evolving business environment”. We hope that Budget 2024 we deliver practical and meaningful supports for SMEs.

 

General Cost of Living Measures

It has been suggested that there is a government aim to give circa €1,000 in tax cuts to the ‘ordinary worker’. This may come in the form of credits and changes to the tax bands. 

It is expected that with the previous success of the energy tax credit and rent tax credit that these will feature in Budget 2024.

In Budget 2024 we also expect to see increases in income tax credits and the income level at which people enter the higher tax rate.

There has been much speculation about the unpopular Universal Social Charge (USC) and the possibility that USC bands could be reduced from 4.5% to 4%. It will be interesting to see if anything actually happens with this. 

 

Budget Newsletter

Following the announcement of Budget 2024 on 10 October 2023 we will produce a full report outlining how it will affect small businesses and the self-employed. Register for our Budget Newsletter here to get our report delivered straight to your inbox.

 

Last updated: 14th September 2023