ieExplains: Here are the cost-of-living payments from Budget 2024 that take effect from today
1 Wage 70 An The Increase Hour By January National €12 €1 Will Minimum To From 40
A reduction in USC and an increase to the minimum wage are just some of the changes that take effect today as a result of Budget 2024.
Announced in October, Budget 2024 contained a slew of cost-of-living measures and tax changes which the Government said would be phased in over a period of months.
Giving his speech to the Dáil, Finance Minister Michael McGrath said Ireland faced challenges ahead but did so “from a position of strength”.
He said: “[This] budget provides help to households and businesses, it reaffirms our commitment to good-quality public services and to investment in modern infrastructure, it seeks to unlock the further potential in the enterprise sector, it underpins our determination to tackle climate change and the budget seeks to make the future safer for us all.”
As is customary, many of the changes announced kick in to begin the new year, so here’s what you can expect.
The ceiling for the 2% Universal Social Charge (USC) increases by €2,840 to €25,760 today, while the 4.5% USC rate will fall to 4% for incomes between €25,760 and €70,044.
Mr McGrath said at the time: “Taking the example of a single person earning €46,000 in 2024, they will see an increase of over €2,000 in their net income as a result of cumulative income tax and USC changes since 2021.”
The national minimum wage will increase by €1.40 to €12.70 an hour from January 1.
From today, the age limit for free contraception will increase to include women aged 31. Previously, only women aged 17-30 could access free contraception.
In terms of supports for unemployed people, community employment (CE), Tús, and Work Placement Experience Programme weekly payments increase by €12 from today.
For businesses, the Research and Development Tax Credit will increase from 25% to 30% on qualifying expenditures from January 1. The first-year payment threshold will also increase from €25,000 to €50,000.
Meanwhile, Vat registration thresholds will increase to €40,000 for services and €80,000 for goods.
Under measures related to the environment and climate, Budget 2024 included that the tax disregard for personal income received by households who sell residual electricity from micro-generation back to the national grid would be doubled from €200 to €400.
From today, the income disregard of up to €400 per year will apply to profits to a qualifying person from the micro-generation of electricity. “This will provide relief from income tax, USC and PRSI,” the finance minister said.
The Vat rate for the supply and installation of solar panels in schools is being reduced to zero from today.
The 9% Vat rate on ebooks and audiobooks will also be reduced to zero today.
Also, the Motor Insurers Insolvency Compensation Fund levy will be reduced by 1% from January 1 2024. Mr McGrath said this would benefit up to 2.2 million policyholders on renewal.