Budget 2016 Summary

Here at VoucherPages.ie, we try to save you money. With the increased costs of living and taking so much in previous budgets, the 2016 Budget has been announced with small steps to add a small bit back into your wallet but there is a long road still to go for citizens of Ireland.

Minister for Finance, Michael Noonan, stated that “all workers will gain a full extra week’s wages” and that Ireland is on course to be the fastest-growing economy in Europe for the second year in a row, and that with a State deficit for 2015 of 2.1%, we are ahead of the target of 2.7%. Mr Howlin said the budget deficit was 12.5 per cent when the Coalition came to power in 2011.

Key elements of the Budget 2016 inlcude:

Here are the main points of Budget 2016:

  • Income tax will decrease with the marginal rate of tax down reduced to 49.5% for individuals earning under €70,044 .
  • The much maligned Universal Social Charge will be less. The entry point for  USC will rise from €12,012 to €13,000. The 1.5% USC rate (on the first €12,012 earned) will be cut to %; the 3.5 % rate (on income of €12,012 to €18,668) is reduced to 3%, and the 7% USC rate (on earnings of €18,668 to €70,044) will reduce to  5.5%.
  • Self employed and farmers will receive an Earned Income Tax Credit of as do not receive the PAYE credit.
  • The statutory minimum wage is to rise from €8.65 to €9.15 per hour.
  • Income qualifying for the Knowledge Development Box will be subject to a reduced rate of corporation tax of 6.25%.
  • Capital Gains tax rate will be 20% per cent  for the sale of a business up to a limit of €1 million in chargeable gains.
  • The bank levy is to remain in place until 2021.
  • A stamp duty exemption for young trained farmers is to be extended for a until 2018.
  • The pension fund levy will be abolished.
  • The social welfare Christmas bonus will be 75% of the recipient’s weekly payment.
  • The old age pension will increase by €3 per week. Also, pensioners will get a Christmas bonus of 75% of the recipient’s weekly pension payment.
  • Child benefit will increase by €5 per month.
  • For new parents, two weeks of statutory paternity leave will be approved.
  • Free pre-school childcare will be available for children from 3 years until they start primary education or are five and a half years of age.
  • Parents will be happy that the free GP care scheme is expected to be available for children aged under 12.
  • The threshold for the Family Income Support payment is to increase by €5 per week for families with one child and €10 for those with two or more children.
  • The respite care grant for carers will be restored to its previous level of €1,700.
  • A tax credit for people who are carers in the home rises by €190 to €1,000. The income threshold for home carers will also increases.
  • Fuel allowance will be increased to €22.50 a week.
  • Motor tax for commercial vehicles above a certain size will be reduced to a maximum of €900.
  • Capital Acquisitions Tax tax-free threshold to €280,000, where property is transferreda between parents and their children.
  • Funding will be available for new teachers and garda will be recruited.
  • Nama is to deliver 20,000 residential units with 90% in greater Dublin area.
  • The excise duty on a pack of 20 cigarettes is to increase by 50%.

Let us know your comments on the budget.

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