Budget 2023 is just over a week away, and supports are expected to focus on middle and lower income earners who have been worst affected by the rising rate of inflation.
The cost of living package in this year's Budget is expected to cost at least €2 billion, the biggest cost of living package in Budget history. Those earning between €35,000 and €50,000 look set to benefit from a range of new measures that are expected to be introduced in this year's Budget.
Meanwhile, Government officials are considering a change to income tax bands, which could see workers earning an annual salary of €50,000, taking home at least €500 extra. As part of Budget 2023, Minister for Finance Paschal Donohoe is expected to increase the 40 per cent income tax band by €2,500, meaning workers won't have to pay the higher tax rate on any earnings below €39,500.
Read more: Budget 2023: Thousands in line to receive €500 boost to pay packet
What is a middle-income earner's wage in Ireland?
In Ireland, those who receive a between €35,000 and €50,000 are described as middle-income earners.
Here is a look at what we know so far for middle income workers:
Tax Cuts
Tax cuts that would cost a total of €1.8bn are being considered by the Government in Budget 2023. Ministers are considering increasing standard income rate bands by €2,500 and an increase in personal tax credits of €100 for single people to €1,800 and a €200 increase for married people to €3,600.
The PAYE credit may also be raised by €100, from €1,700 to €1,800. Tanaiste Leo Varadkar has promised tax cuts that would help “squeezed” middle-income earners the most.
“The most important thing is that middle-income people will see a substantial reduction in the amount of income tax they pay,” Mr Varadkar said earlier this month.
Petrol and Diesel costs
The Government is also considering extending the cut on excise duty of 9pc on petrol and diesel that is due to expire at the end of this year for another six months to help offset soaring fuel costs, with middle income earners set to benefit from this.
Energy Payments
Sky-rocketing energy bills are not likely to let up anytime soon, and according to latest CSO figures electricity costs has jumped by more than 86 per cent in 12 months.
To combat this, a total of three €200 energy credits have been proposed by Government. Green Party leader Eamon Ryan has indicated that one payment could be made before Christmas, with the other two €200 lump sums to be paid before spring.
Education
Fees for third-level students could be reduced by up to €250 a year for students paying €3,000 a year in college fees. It comes as young people are pleading for the government to reduce college fees and raise the national minimum wage for under-20s so they can afford to live in Ireland.
This comes after over 70 percent of young people aged 18-24 admitted that they are considering moving abroad because they think they would enjoy a better quality of life elsewhere. The National Youth Council of Ireland has expressed their concern regarding the impact the cost-of-living crisis is having on young people in Ireland and is calling for action from the Government to prevent young people from moving abroad.
Social Welfare and Sick Leave
Predictions have been made that that all social welfare recipients will receive an additional once off payment during autumn. This would be similar to a Christmas bonus allocated last year, which saw people receive an additional €20 on their social welfare payments.
Leo Varadkar has also said there may be a new law on sick leave, entitling almost all workers in the State to sick pay of up to €110 per day, would come into effect in 2023. However, unions have criticised deferring the new law until next year which was initially planned to come into effect this month.
Child Benefit
A once-off child benefit payment is also being considered to support families, which is expected ahead of the Christmas season. Parents with one child could receive €280 under this proposal, while parents with two children would be entitled to €560.
The move would be a huge boost to parent, who would be in line for a €280 one-off payment if they have one child or €560 if they have two. Meanwhile, a family with three children is eligible to receive €840 if the Government agrees to the policy.
A family with twins would also get €840 as they receive one-and-a-half times the normal rate per child.
Childcare
It is understood that Government is also aiming to reduce childcare costs by €200 per month next year and a further €200 per month the following year. Children's Minister Roderic O'Gorman previously said he hopes to see childcare fees fall by 50 per cent over the next two years.
The move would be a huge boost to parents from middle income backgrounds, who are feeling the squeeze from childcare in recent months.
Read Next:
- Social welfare Ireland: Pension hikes announced for people who work until they are 70
Three social welfare payments that can help pay for rising gas and electric
Bonus energy payment expected to soften bills blow before Christmas
Budget 2023: Double payments, Christmas bonuses and energy credits among cost of living measures
Social Welfare Ireland: Payments of up to €924 to tackle energy crisis costs just 9 days away
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