Irish Budget 2018 – Main points
The Minister for Finance gave an upbeat assessment of the economic situation with growth forecast at 4.3% in 2017 and 3.5% in 2018. The government forecasts unemployment to average 5.7% in 2018 vs 6.1% currently. However he cautioned on the the ‘still too high’ debt burden and said reducing that burden is critical.
The expected ‘Rainy Day Fund’ will commence with a transfer of €1.5 billion from the Strategic Investment Fund in 2018, followed by €500 million per annum from 2019.
Capital expenditure will increase by 17% to €5.3 billion in 2018.
Government will spend €1.83 billion on social housing in 2018 and increase the HAP scheme by €149 million.
€750 million will be allocated from ISIF to ‘Home Building Finance Ireland’ to provide funds to private residential developers.
Commercial property stamp duty will be increased from 2% to 6% with immediate effect, but refunds will be available for residential development.
The levy on vacant sites will increase from 3% to 7% effective in 2019.
CGT waiver for property purchases from budget 2012/3 will reduce from 7yrs to 4yrs.
Mortgage interest relief to be phased out by 2020
€685 million increase on health spending to €15.3 billion (circa +5%). Education spending will be more than €10 billion.
Extra 1,800 healthcare and 1,300 teaching staff to be hired in 2018.
Brexit loan scheme of €300 million to be made available to SMEs @market rates for short-term working capital needs.
No change to reduced VAT rate for tourism industry
Personal & Corporate Taxes
Higher rate tax band increasing from €33,800 to €34,550.
USC rates cut from 2.5% to 2% and 5% to 4.75% respectively.
Earned income tax credit increasing by €200 to €1,150 for the self employed.
SMEs can avail of a new scheme to grant share options to employees.
Corporate tax rate of 12.5% unchanged. “Will remain a core part of our offering”
In summary despite a lot of small positives, Budget 2018 provided few surprises and will not result in a meaningful financial difference to individuals, families or SMEs.
Ardbrack Financial Ltd
Telephone: 021-4773833 | email@example.com | www.ardbrack.com
Disclaimer: The content of this article is for general information purposes only. It does not constitute investment advice as it does not take into account the investment objectives, knowledge and experience or financial situation of any particular person or persons. You are advised to obtain professional advice suitable to your own individual circumstances. Ardbrack Financial Limited makes no representations as to the accuracy, validity or completeness of the information contained herein and will not be held liable for any errors or omissions.
Ardbrack Financial Ltd is regulated by the Central Bank of Ireland