Budget 2018 – Looking to the future
Middle-income earners and two-income families were the main, albeit modest, beneficiaries of Budget 2018 with a combination of USC cuts and a widening of the top income tax band likely to deliver an increase just under 1 % in average take-home pay.
In his first Budget, Minister for Finance Paschal Donohoe also announced a raft of measures to tackle the housing crisis, including a new State-run lending vehicle to get builders on to sites, a doubling of the proposed vacant site tax levy and a bigger capital allocation for social housing.
The biggest revenue-raising measure and the one that drew the ire of the building lobby was a trebling of stamp duty on commercial property transactions from 2% to 6%, which is expected to net the exchequer nearly €400 million a year.
As expected, Mr Donohoe’s tax measures centred on cuts to the USC, which benefitted anyone earning more than €13,000 a year, the income limit at which people are liable for the charge. He also increased the earned income credit for the self – employed by €200 to €1,150, falling well short of PAYE parity of €1,650.