Ireland’s Government Confirms Budget 2026 Focus on Targeted Support

The Irish government has provided its final update regarding potential lump sum payments in the upcoming Budget 2026. This year’s budget is expected to differ significantly from previous years, with a focus on housing, infrastructure, and potential changes to value-added tax (VAT) for the hospitality sector.

Taoiseach Micheál Martin confirmed that there will be no “universal” cost-of-living packages included in Budget 2026. This marks a departure from last year’s financial package, which featured a series of one-off payments, including the Working Family Payment, Fuel Allowance, Living Alone Increase, and Domiciliary Care Allowance. Payments ranged from €100 for a qualified child’s increase to €400 for six different schemes.

During an interview with Newstalk Breakfast, Martin acknowledged the ongoing cost-of-living crisis but emphasized that the government has already implemented measures to address it. “We’ve got to try and get public finances within some reasonable sustainable framework,” he stated. He added that while the government will focus on targeted support for low-income individuals, the overall strategy will not encompass universal measures.

Future Investments and Budget Announcements

The full details of Budget 2026 will be unveiled by Ministers Paschal Donohoe and Simon Chambers on October 7, 2025. Reports indicate that the government is likely to extend the Help to Buy Scheme and the First Home Scheme until 2030. Discussions are also underway concerning the Rent Tax Credit, which is currently set to expire in December 2025, with potential plans for an extension into the following year.

Additionally, the government is considering a reduction in VAT for the hospitality sector, proposing a decrease from 13.5% to 9%. However, this reduction may be postponed until July 2026, as discussions continue about the timing of such a change.

As Ireland prepares for a new fiscal year, the focus will remain on sustainable financial practices while addressing the immediate needs of its citizens. With targeted measures set to be revealed in the upcoming budget, many will be watching closely to see how these decisions will impact households across the country.