TÁNAISTE SIMON HARRIS has given his strongest indication yet that the Rent Tax Credit (RTC) will be increased in this year’s budget.

Speaking to the media as the Fine Gael party think-in drew to a close, Harris said:

“I’m positively disposed to trying to do something in relation to this.”

The value of the credit for 2022 and 2023 was €500 for a single person and €1,000 for a jointly assessed couple.

It was later increased to €1,000 for a single individual and €2,000 for a jointly assessed couple. There was no increase to the rent credit last year.

“It wasn’t increased last year, and therefore, I always say this to colleagues that if it’s in the programme for government, that’s our north star. That’s what I’m meant to be trying to deliver,” he added.

While he said there are limitations in the size of the tax package this year, Harris said he is “hopeful we can do something”.

“It’s something that’s very much been examined and looked upon positively,” Harris said.

A source said there is a recognition that this tax credit is very important in terms of helping renters. They pointed to the latest figures which demonstrate there is a very significant number of people now benefiting from it and stated that further movement is on cards in this year’s budget.

More than 335,000 taxpayers benefitted from the rent credit in 2024, with more people applying for the tax benefit than previous years.

The national average for monthly rent in the first quarter of this year for a two-bed apartment was €2,176 – a jump of 7.8% over the previous year.

In Dublin city centre, this was €2,828 while Galway was the next most expensive city at €2,309 on average per month. Cork city’s average rent was €2,103, Limerick city’s was €1,900 and Waterford city’s was €1,490.

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Aside from the RTC, the Tánaiste was also asked about possible changes to inheritance tax.

“Inheritance tax is certainly something we’ll take a look at in the budget. I want to be very honest with people. The tax package is around 1.5 billion, probably slightly more when you take in a few revenue-raising measures we may be able to do, and the bulk of that tax package will be taken up by a personal income tax package,” he added.

Asked if the tax thresholds will be increased, Harris said it is an area the government wants to make progress on.

“I believe the government can make progress on both Capital Acquisitions Tax (CAT) and Capital Gains Tax (CGT) during the lifetime of the government. The question is how much we can do in this budget. It’s quite possible we may be able to do something, but like I say, this is budget one of four that are left. But I think the direction of travel in terms of both Capital Acquisitions Tax and Capital Gains Tax is these are areas that do need to see progress made,” he concluded.