ON 27 SEPTEMBER, the measures in Budget 2023 were announced by Finance Minister Paschal Donohoe and Public Expenditure Minister Michael McGrath.

The Budget came in at €11 billion and some of the key announcements included an increase to the income tax package, a €600 electricity credit, and once-off double payment week for social welfare recipients.  

While some of the measures kicked in almost immediately, others will take effect from today.

Here’s what you need to know:

Social Welfare

There’s also an increase of €12 per week in social welfare payments.

This increase will bring the full State pension to €265.30 per week and the maximum personal rate of Jobseeker’s Allowance and Jobseeker’s Benefit with no dependents to €220 per week.

The weekly rate for a qualified child has increased by €2 from €40 to €42 for children under 12 years of age, and by €2 from €48 to €50 for children aged 12 years and over.

From today, the national minimum wage for people aged over 20 will increase by 80 cent to €11.30.

People getting Disability Allowance and Blind Pension will be able to earn up to €165 from work without affecting their payment, an increase of €25 on the previous threshold of €140.

The Community Employment (CE), Tús and Rural Social Scheme top up payment will also increase by €5 from €22.50 to €27.50.

The Domiciliary Care Allowance will increase by €20.50 to €330 per month and will be available in respect of children with severe illness or disability who remain in hospital for up to six months after birth.

The income threshold for Fuel Allowance has increased from €120 to €200, while for those over 70 the weekly Fuel Allowance means test limit has increased to €500 for a single person or €1,000 for a couple.

The Working Family Payment income limits has increased by €40 across all family sizes.

The income received from agri-environmental schemes disregarded in the means test for Farm Assist will increase from €2,540 to €5,000.

The weekly income threshold for the higher rate of employer’s PRSI has increased from €410 to €441. This is to ensure that there is no incentive to reduce the working hours for a full-time employee on the increased minimum wage.

From today, there will also be a new Susi rate, which will increase by between 10% and 14%.

The National Childcare Scheme subsidy has increased from €0.50 per hour to €1.40 per hour, which means up to an additional €40.50 reduction in weekly childcare fees for parents.

Tax

While income tax rates will stay the same (at 20% and 40%), there will be increases to tax credits and changes to the income tax bands.

The standard rate tax band (the amount you can earn before you start to pay the higher rate of tax) will be increased by €3,200 to €40,000 for a single person and to €49,000 for married couples with one earner.

The Personal Tax Credit, Employee Tax Credit, and Earned Income Tax Credit will all increase by €75 to €1,775.

The second band of the Universal Social Charge has also been adjusted.

The ceiling of the second USC rate band has now increased from €21,295 to €22,920 to support those on the new minimum wage of €11.30 per hour.

VAT

From today, the VAT rate on newspapers will be reduced from 9% to 0.

VAT will also be reduced to zero on defibrillators, period products, hormone replacement therapy, and nicotine replacement products.

Meanwhile, a reduced VAT rate of 9% for the hospitality and tourism sector will continue until 28 February.

A temporary reduction in the rate of VAT from 13.5% to 9% on the supply of gas and electricity will also remain in place until 28 February.

Sick pay

Employees also have right to three days’ sick pay a year from today.

This is statutory sick pay and is the legal minimum.

Sick pay is paid by your employer at 70% of your normal pay, up to a maximum of €110 a day.

You must be an employee and be working at least 13 weeks with your employer before you can get statutory sick pay.

Your employer can have a more generous sick pay scheme, but they can’t give you less than the statutory amount.

What comes into place later this year?

A second electricity credit worth €200 will be made this month, with payments beginning from today.

Depending on a household’s individual billing cycle, people will see the credit during January or February.

A third €200 instalment is coming in March and will apply in the March/April billing cycle. 

Elsewhere, the Defective Concrete Products Levy is due to be introduced in September to help pay for the Defective Concrete Blocks Redress Scheme.

It was originally proposed as a 10% levy on concrete blocks, pouring concrete and other concrete products, but has since been reduced to 5%.

Public hospital in-patient fees will be removed for all patients from 1 April.

The income limit for the GP visit card will also be increased in April to include people on a median household income of €46,000 or less.

A carbon tax increase was applied to petrol and diesel from 12 October, but was offset by a reduction to zero of the National Oil Reserves Agency levy.

However, from 1 May, the carbon tax increase will apply to all other fuels, including household fuels.

From 1 September, the free contraception scheme will be extended to include woman aged 16 to 30.

There will also be changes in the education sector from September.

Free schoolbooks will be primary school students from September 2023, and the income threshold for the 50% student contribution grant will increase from €55,240 to €62,000 per year.

The student contribution will also be reduced by €500 for families earning between €62,000 and €100,000, while the Postgraduate fee grant will increase by €500.

Meanwhile, reduced fares of 20% on public transport will continue until the end of this year, as will the 50% price reduction on the Young Adult Leap Card.

The Young Adult Leap Card will be extended to 16, 17 and 18 year olds in third-level education.

And beyond this year, the Help to Buy Scheme will run until the end of 2024.

Elsewhere, the stamp Duty Residential Development Refund Scheme will run until the end of 2025, as will the Farm Consolidation Stamp Duty Relief.