Details are emerging tonight on Budget 2016.
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Other welfare payments should also improve such as the Christmas bonus for the unemployed and the restoration of a few of the carer grant.
With the economy forecast to be Europe’s best performing for a third successive year in 2016 and expand by at least 3 percent every year until 2020, Finance Minister Michael Noonan will use his speech to lay out a plan predicated on the coalition government being re-elected.
Reductions in the Universal Social Charge (USC) rates and tax credits for the self-employed are widely expected, as is a raising of the entry level to exempt all on the minimum wage.
A second free pre-school year and paid paternity leave are among the childcare measures.
In terms of Universal Social Charge, the changes to three of four rates have been well leaked.
Noonan will also seek to tackle a severe shortage of housing in urban centres for the third budget in a row, possibly bringing in legislation to link residential rents to the rate of inflation to temporarily control soaring costs.
The threshold at which people pay the USC now stands at over €12,000 – that will rise to €13,000 and will take another 90,000 people out of the tax.
As he made his way into the Dail this morning, he told reporters: “Having restored the economic sovereignty of the state, we’re now in a position to address issues that are under stress so the Government have decided that the Budget will focus on work and the supporting of work”.
Entrepreneurs and start-up enterprises are to be enticed with a reduced capital gains tax rate while there has also been pressure on the Government to move on inheritance taxes. At the moment, children can inherit up to €225,000 from their parents tax-free, with the remaining balance taxed at 33%.
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Finance Minister Michael Noonan and Public Expenditure Minister Brendan Howlin will deliver the taxation and spending measures from 2pm today.
