Government ministers are currently finalising the details of next year’s Budget ahead of its publication on October 12.
Crunch financial decisions for the next 12 months of the €4.7 billion package of spending will be confirmed soon.
While Minister for Public Expenditure Michael McGrath and Minister for Finance Paschal Donohoe are continuing to work on the document, we already know a number of changes that are expected to be implemented.
A number of measures have already been revealed ahead of Budget day in ten days’ time, meaning many of the reforms set to impact Irish taxpayers are likely to be confirmed before then.
Some revelations are going to be of particular interest to people aged under 40, including hundreds of thousands of people on social welfare or minimum wage.
Here’s what those under 40 can expect in Budget 2022:
Minimum wage increase
Tanaiste Leo Varadkar told the Dail this week that an increase to the current minimum wage is needed as the cost of living rises.
This could be reflected in both wages for workers and social welfare rates.
Thousands of people under 40, particularly teenagers and college students, are employed in minimum wage jobs such as hospitality so an increase after a difficult 18 months would be welcome.
Mr Varadkar said that “pay increases in most parts of the economy” are coming, “including the public service, as well as an increase in the minimum wage”.
He also mentioned increases in social welfare, so that people can keep up with the rise in the cost of living.
The national minimum wage is currently at €10.20 but Mr Varadkar did not indicate how much wages will go up in this year’s budget.
It comes after the Central Statistics Office reported this month that inflation has reached its highest level in 10 years.
Drink price changes
There has been little information released so far on whether the price of alcohol or cigarettes will rise in Budget 2022.
However, it is expected that there will be no increase in the cost of drinks given the difficult year and a half it has been for those in the hospitality industry.
Tanaiste Leo Varadkar has hinted that there will be a bonus or reward for those impacted by the coronavirus pandemic.
It was revealed last week that the Government plans to give frontline workers a bonus of some kind as a reward for their efforts during the last 18 months since the first Covid case was recorded here in March of 2020.
Social welfare recipients are also set to benefit from a bump in income from the Budget.
Those who have been claiming PUP or other social welfare payments because of the pandemic will see up to €1,860 “to compensate for the reckonable service that you have lost due to no fault of your own.”
Everybody in the country could be getting a €100 voucher to spend on tourism and hospitality this winter, Tourism Minister Catherine Martin has indicated.
Ms Martin is currently engaged in budget bilaterals with the two people that hold the pursestrings in Government, Paschal Donohoe and Michael McGrath, the Ministers for Finance and Public Expenditure.
And she told the Irish Mirror that a voucher scheme for all is part of the negotiations as she bats for the tourism sector in the Budget talks.
She said: “There’s a lot to be considered for tourism supports, I know that is one of the issues they are looking at.
“So, it’s part of the budget negotiations, so I’d prefer to keep that to the crucible of the budget negotiations, but just to say, that I’m very aware from engaging with the tourism and recovery oversight group of what their asks are.”
PRSI, income tax and corporation tax
There is expected to be minimal changes to income tax in the upcoming Budget.
However, Mr Varadkar has hinted at further changes to employer PRSI and said they can be justified to improve benefits or to fund affordable healthcare, childcare, or higher education.
The Tanaiste said: “A legacy of the pandemic will be a larger State. As pro-business and pro-enterprise advocates we need to shape what that bigger State will look like.
“A larger State does not necessarily mean more taxes. Not when you have growth in employment, business and wealth.
In relation to corporation tax, he said that increases to the current rates are unlikely because if we were to move away from Ireland’s industrial policy framework – which includes a stable and low rate of corporation tax – “we would need to be certain about what we are being asked to agree and implement.