€1k & €2k Budget 2027 cash boost CONFIRMED amid new rent tax credit €300 talks as Govt ‘seeing what they can do’ on fuel

THE renters’ tax credit will be increased in the Budget, the Taoiseach has said, as fuel excise is also being examined.

The scale of the increase will be closely watched as ministers seek to finalise negotiations before Budget day on October 6, with Government also examining measures on energy and fuel.

Tanaiste Simon Harris said it “may not be prudent” to proceed with the unwinding of excise cuts to petrol and diesel in November if prices remain elevated.

The rent tax credit was introduced in 2022 and has since been extended and increased up to a yearly maximum of €1,000 euro for an individual or €2,000 euro for a couple who are jointly assessed for tax.

It was reported in the Irish Examiner that Housing Minister James Browne is seeking to increase the credit by €300

Asked if he supported an increase of that scale, the Taoiseach said the credit has been “positive”, adding: “We will be increasing it in the forthcoming Budget.”

Micheal Martin told reporters before Cabinet: “The only issue I’d have is some people are not availing of it and that’s an issue that we need to really examine.”

Tanaiste and Finance Minister Simon Harris said there was a “need to help people with the cost of rent”, adding he was “positively disposed” to increasing the credit.

Specifically asked if it would be increased by €300 euro, Mr Harris said: “It’s going to be a long 15 days if we’re going to go through every specific line of the Budget and every specific amount inside the Budget.”

He added: “There will be tax measures in that Budget. The bulk of the tax measures will go on a personal income tax.

“There’s a tax package of around €1.5 billion. We all know any personal income tax package comes in at around €1.2-ish billion.

“So, there’s a little bit left to do other things. The programme for government is clear – that’s what unites everybody in Government – that the renters’ tax credit is an area that should be increased if possible, and therefore we will look favourably upon that.

“The level at which we do it is a matter of for Budget day.”

Elsewhere, the Tanaiste also raised the prospect of further measures on the fuel allowance and living alone allowance, as well as specific interventions for home heating oil.

“I am really conscious that while people are talking about Iran and global issues, this is very real.

“It’s the tank in people’s back garden that they’re worried about filling this winter, and we’re actively seeing what we can do.”

Mr Harris also said there are a “couple of big calls” left in the Budget negotiations including the “profile regarding the excise restoration” for diesel and petrol, which is currently due to recommence in November.

He said: “That may not be the prudent thing to do now if the current elevated prices continue. So we need to look at that.”

Meanwhile on housing, Mr Harris said abolishing stamp duty for first time buyers would be a “bad measure” and a “tax cut for developers”.

The idea had been put forward by Fianna Fail’s Seamus McGrath and backed by the Taoiseach.

Mr Harris said: “It would be a bad measure. That’s just not my view, it’s the view of the economists in my department.

“You know, I’m old enough to remember when people tinkered with stamp duty in the past, and I’m old enough to remember the devastation that people lived through in this country.”

He added: “That’s not the intention of everybody, everybody’s putting
forward good ideas, everybody’s being constructive – but you don’t narrow the tax base, what you do is you increase supply.

“And all of the economic evidence available to my department is that not one cent of a reduction in stamp duty would be passed on to a first-time buyer. It would effectively be a tax cut for developers.”

Mr Harris also said there are no proposals to increase the help-to-buy scheme in the Budget.

Mr Harris said another issue in the Budget is potentially modifying carbon tax for specific products like home heating oil, as well as additional measures on energy transition like solar panel grants.

The Tanaiste and Minister for Finance is set to deliver a speech at the Economic and Social Research Institute (ESRI) in Dublin to outline the impacts of ongoing geopolitical upheaval and Ireland’s ageing population.

The Fine Gael leader will argue that an ageing population, geopolitical instability, Russian aggression, shifting US policy and competition from China mean the Government faces crucial choices over the years ahead.

He also warns that Ireland “cannot throw money at every problem and expect results,” saying fundamental reforms are needed to ensure major infrastructure projects in the National Development Plan are delivered.

The Fine Gael leader detailed: “By 2050, just 24 years away, Ireland will look a lot like Italy or Japan does today.

“In such a society, growth will be lower, costs will be higher and the burden on taxpayers – our children – will be immense.

“There is no way of avoiding that fate and that is why it is so important that we continue to run surpluses and invest in our sovereign wealth fund.”