Monday 19 February 2018

Four days to go: Budget 2018 negotiations are down to the wire - here is everything we know so far

  • Across-the-board welfare payments under consideration
  • Any increases likely to be delayed to mitigate cost
  • Welfare boost will 'limit potential elsewhere'
  • Unpopular prescription charge for elderly
Independent.ie Newsdesk

Independent.ie Newsdesk

Negotiations are continuing on aspects of next Tuesday's budget with Finance Minister Paschal Donohoe endeavouring to produce a balanced budget against a backdrop of a considerable list of demands.

Social welfare payments set for boost... but by how much?

With Budget 2018 fast approaching there has been a push for an across-the-board increase to social welfare payments on the table, despite a limited availability of cash for new spending.

The Irish Independent is reporting that increases to all welfare payments are being planned ahead of Tuesday’s Budget.

A €5 pension increase has already been pledged by Fine Gael but now it has emerged that the party alongside Fianna Fáil and the Independent Alliance want to boost everything.

Fianna Fáil are understood to be requesting an increase of up to €5 for all social welfare payments but have not tabled suggestions for how these should be funded.

The notion of prioritising one welfare payment over another has been dismissed with one Government source saying: “We can’t leave anybody behind.”

“Paschal has warned this will cost an awful lot of money and limit potential elsewhere,” a source told the paper.

But despite the push for universal hikes, some sources cautioned that “tough decisions” would have to be made and “it simply mightn’t be possible to do everything”.

The unpopular prescription charge for elderly looks set to be cut

Around 100,000 people aged over 65 are in line for a cut in the unpopular prescription charge bringing the monthly cap on their prescription charge payments to €20 a month, leaving people with up to €5 extra in their pocket.

It will affect medical card holders between the ages of 65 and 69.

Middle Ireland in line for USC cut and tax-band tweak

The much reviled Universal Social Charge is due to be cut but a final revision has yet to be decided. Meanwhile, the tax bands will be tweaked to raise the ceiling at which workers begin paying the higher rate of tax.

The USC cut will help the ‘squeezed middle’ earning up to €70,000 a year, while the tax band changes will benefit people on salaries over €33,800.

However, the net increase in workers’ pay packets is likely to be less than €20 a month.

Cigarettes will be more expensive

For the sixth budget in a row a hike to the price of a packet of cigarettes is expected. It is believed an extra 50c will be added to the cost.

It is not yet clear if there will be any hike to excise duty on alcohol.

A sugar tax is on the way

A long-talked about "sugar tax" is due to be introduced in April 2018 and is expected to raise a substantial amount for the exchequer.

Taoiseach Leo Varadkar has been a long time supporter of such a charge.

Not everyone is happy yet... 

The current political set-up means that Minister Donohoe has a long list of interests to please and with the countdown well-underway it is believed the Independent Alliance is still unhappy with its current offering.

A sticking point has proven to be an additional betting tax of up to 5pc which would raise around €55m. The Alliance wants this ring-fenced for addiction and mental health services.

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