What can we expect from today's budget
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What will the Finance Minister announce about spending and taxes in today’s budget?
Just under five and a half hours from now, the Finance Minister, Pascal Dunhu, will rise to his feet in the Dáil and let us know what the government intends to spend your money on next year and how much of that money he will take away or give back to taxpayers. We've already been warned not to expect the kind of giveaways we received last year, just before an election. But we should probably expect a lot of money to be allocated to fix Ireland's severely out-of-date national infrastructure. But what else should we expect? Colm O'Callaghan is the tax partner with PwC and is on the line. Good morning, Colm. Morning, Joe.
How much focus will the budget put on upgrading Ireland’s national infrastructure?
Can we start with that infrastructure need? What are you expecting to hear this afternoon in infrastructure?
Yeah, I think you're right. The government is really going to focus on balancing and maintaining Ireland's competitiveness and particularly infrastructure is a key area they need to focus on. I think in relation to infrastructure, housing is going to be the key priority, I think, and we've already seen that. them clearly signposting and flagging the VAT on new apartments and the sale of new apartments will come down to 9%. And I think that's going to bring about 40,000 units that are just after getting through planning into a lower price bracket. Interesting overnight as well, there seems to be mutterings to say that there's going to be some form of exemption or reduction in corporate tax for companies building basically cost rental properties and renting at below market rates.
And I think that's interesting because that's going to try and bring in some private investment to help really supercharge and get investment and development of housing particularly.
Yeah. And of course, then there's also the need to get water infrastructure, electricity infrastructure. How do you use the tax system column to enable these big projects to be done any quicker?
Well, I think it's probably been an underused lever, the whole area of tax policy, to drive private investment into some of these projects. And I think it would be really welcome to see if they kind of bring some of those kind of initiatives to the fore by allowing tax policy, incentivize companies, invest into infrastructure, whether that be water projects, whether that be infrastructure. you know, capital infrastructure projects or roads or anything along those lines. But we'll have to wait and see. I don't think there's been a lot of, there hasn't really been an awful lot of detail yet given by the government, particularly in their action plan around competition and productivity.
Which housing measures—like VAT cuts or corporate incentives—are expected to boost new and cost-rental homes?
And we'll have to really see what will they do in relation to infrastructure in that regards.
I wonder, Colin, whether they could signal, the government could signal today some sort of legal changes to the planning system in the budget to improve the infrastructure lot.
Yeah, I think that's going to be... I mean, time and time again, we hear from businesses that look realistically, planning is a big obstacle. It's taking years. It's taking, you know, multi-years in some cases to get certain projects off the ground. And that's not really... ideal for businesses, particularly international businesses and local businesses that are trying to plan for the future. And we're seeing now starting to come out that some businesses are considering putting projects elsewhere rather than in Ireland, just down to pure planning and challenges associated with getting planning approval.
Yeah, we saw the Apple pull out from a big planned data centre in Athlone because of the planning delays there as well. What about business taxes? Do you anticipate some more entrepreneur reliefs or R&D tax credits or something like that, Colm?
I don't think entrepreneurs... I'd love to see it personally. I think it will be really, really important for driving investment and for entrepreneurs to get set up. But I do think we will see stuff in relation to R&D. There's likely to be an increase in the credit, I think, hopefully to about 35%. They're talking about expanding the regime so that more SMEs can possibly have avail of it.
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Chapters
7 chapters
1
What will the Finance Minister announce about spending and taxes in today’s budget?
0:01–0:47
2
How much focus will the budget put on upgrading Ireland’s national infrastructure?
0:47–2:34
3
Which housing measures—like VAT cuts or corporate incentives—are expected to boost new and cost-rental homes?
2:34–4:05
4
How could tax policy be used to attract private investment into water, electricity and transport projects?
4:05–5:08
5
How might the government justify a budget with few gains for middle-income earners?
5:08–5:50
6
What changes to business tax supports—R&D credits or entrepreneur reliefs—might the budget include?
5:50–6:57
7
Will the government increase rainy-day funds or delay one-off cost-of-living supports?
6:57–7:11