Urgent: Ireland’s Budget 2026 Unveiled with Key Investments

UPDATE: Ireland’s Minister for Finance Pascal Donohoe has just announced Budget 2026, detailing a significant investment of €9.4 billion aimed at bolstering housing, job security, and future economic growth. The urgent budget, revealed on October 7, 2023, allocates €8.1 billion for public spending and €1.3 billion in taxation measures, emphasizing the government’s commitment to safeguarding the nation’s future.

The budget comes as the economy demonstrates remarkable resilience, with 2.8 million people currently employed and an additional 63,500 jobs projected by the end of next year. Inflation is expected to stabilize around 2 percent this year, while domestic economic growth is forecasted at 3.3 percent for 2025 and 2.3 percent in 2026.

Housing is a focal point of Budget 2026, with the government committing €5 billion for capital investment. Notably, the VAT rate on completed apartment sales will drop from 13.5 percent to 9 percent, aimed at reducing the viability gap in construction. Furthermore, the Rent Tax Credit has been extended for three years, and the Mortgage Interest Tax Relief will continue for two more years. A new Derelict Property Tax will also be introduced to combat increasing dereliction rates.

The budget allocates €11.3 billion to the Department of Housing, Local Government, and Heritage, with €2.9 billion earmarked for new-build social homes and second-hand housing acquisitions. Additionally, €1.2 billion will support the government’s starter homes program, including the Help to Buy initiative.

In a significant move for workers, the national minimum wage will rise by 65 cents to €14.15 per hour starting on January 1, 2026. The threshold for the USC two percent rate band will also increase, providing further financial relief.

Energy initiatives remain crucial, with the government extending the 9 percent VAT rate on gas and electricity through the end of 2030. A new tax of €71 per tonne of CO2 will be imposed on auto fuels starting October 8, 2023, while €1.4 billion will be allocated to improve the water supply in new housing developments.

In education, funding will increase by €125 million, benefiting 35,000 additional children through the National Childcare Scheme. The budget also plans to hire more staff, including over 1,000 new teachers for Special Educational Needs settings and support for early childhood education.

The health budget will exceed €27.4 billion, reflecting a €1.5 billion increase. Key health improvements include the addition of up to 265 acute hospital beds and increased support for community health services, alongside significant investments in mental health.

Social welfare measures include a double Christmas bonus and a weekly increase of €10 for recipients of social protection payments, aimed at supporting vulnerable populations during the winter months.

Transport initiatives will see €4.7 billion allocated to enhance public transport and road infrastructure, including projects like the Bus Connects program.

This urgent budget underscores the government’s commitment to addressing pressing needs across various sectors while laying the groundwork for future stability and growth. As details continue to emerge, citizens are urged to stay informed about the financial implications of Budget 2026 and how it may impact their lives directly.