Looking Ahead to Budget 2018
Budget 2018 is due to be announced on Tuesday, October 10 by the new Finance Minister Paschal Donohoe.
On the day before Budget 2018 is announced, we look at some of the most popular news items over the last few days covering #Budget18
Budget 2018: Modest tax cuts, €5 welfare hikes from March on cards as discussions down to wire
Tomorrow’s budget will be the first of a series that will attempt to gradually increase living standards over a number of years, Taoiseach Leo Varadkar has said.
Mr Varadkar is seeking to cast Budget 2018 as the beginning of a period of continuous but affordable reductions in tax and increases in spending.
The Taoiseach told The Irish Times such an approach would lead to a “modest, sustainable increase in living standards every year” and a “new period of sustained progress”.
Negotiations will continue today between Minister for Finance Paschal Donohoe and Fianna Fáil, as well as with the Independent Alliance members of Government.
The main, outstanding difficulties with Fianna Fáil are on the spending side with discussions continuing in areas such as disabilities, mental health and the package of social welfare measures. It is acknowledged by Fianna Fáil and Fine Gael that there are insufficient resources to introduce wide ranging welfare increases from January. Fianna Fáil sources say they want an increase of €5 in almost all welfare payments, including unemployment benefit, from next March at the latest.
Revealed: With just days to go…everything we know ahead of Budget 2018
- Mix of USC cut and tweaks to tax bands set to net workers €20 per month
- Pension to rise but Christmas Bonuses to be paid at less than 100pc
- Sugar tax to be introduced
- Price of cigarettes expected to rise again
- Diesel prices look set to remain the same
A cut to the much-hated USC and a tweaking of income tax bands will be included in next week’s Budget following a compromise between Fine Gael and Fianna Fáil in an effort to ensure that the budget will pass.
As part of a compromise deal being hammered out between Finance Minister Paschal Donohoe and Fianna Fáil, it has been agreed that a double-edge approach to personal taxation will be taken.
The USC cut will help the ‘squeezed middle’ earning up to €70,000 a year, while the tax band changes will benefit people on salaries over €33,800. However, the net increase in workers’ pay packets is likely to be less than €20 a month.
Budget 2018: Where does all your tax money go?
Servicing the national debt still accounts for 16% of spending – more than the spend on education, housing or justice.
Next Tuesday’s Budget may determine just how much we’re going to have to contribute from our pay cheques to the Government’s coffers in 2018; but just how is the Government going to spend the money it gets to keep?
Well, you might be surprised to learn just how much we’re still spending on our debt – some €10.6bn a year – and how little on areas such as housing (€1.2bn).
Just like in any household budget, the less you spend the more you get to keep – and the converse is also true. So if Government spending rises, so too must the tax burden to cover it. And as a very helpful Government website clearly shows, public spending has dipped this year, thanks in part to a jobs recovery and lower unemployment benefit and cheaper repayments on government debt.
But you might still be surprised at just where your money goes.
And just for fun…
‘Everyone should get a cuddly toy’ – Schoolchildren have their say on Budget 2018
Everyone has an opinion on how the country should be run – including a group of schoolchildren who have some creative ideas for Budget 2018.
Independent.ie paid a visit to Educate Together in Firhouse, Dublin to ask its pupils what they would do if they had €400m to make a difference.
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