Dáil Éireann Debate, Thursday - 4 July 2024
100. Deputy Bernard J. Durkan asked the Minister for Finance to outline his Department’s mission statement with particular reference to his intention and proposals to address the important issues now arising and likely to present a challenge in the future to family households and the productive/caring sectors as required and necessary; and if he will make a statement on the matter. [28582/24]
View answerMy Department’s mission is to lead in the achievement of the Government’s economic, fiscal and financial policy goals, having regard to the goals set out in the Programme for Government – Our Shared Future. In pursuing this mission, for the period 2023-2025 my Department is working towards achieving the following Strategic Goals:
- Balanced, sustainable economic growth
- Sound Public Finances
- Well regulated, sustainable banking and financial sector
- International leadership in economic, fiscal and financial decision making, and
- Promoting environmentally sustainable economic progress.
It is important that Government continues to pursue a balanced and sustainable budgetary policy. In recent years, Ireland has experienced a series of economic shocks, including a two-year pandemic and a war in Europe triggering the most severe energy price shock in decades. While the Irish economy had weathered the pandemic well, fiscal and economic attention through 2023 and 2024 has focussed on the inflationary situation, its impact and the consequent cost of living crisis.
By responding swiftly and decisively to the cost of living challenges, government supports have helped to mitigate the impact of inflationary pressures on both households and businesses. Budget 2023 was a ‘Cost of Living Budget’ focused on mitigating inflationary pressures. Budget 2024 provided €2.7 billion in once-off cost of living measures for 2024, which built upon some €12 billion in direct relief made available to households and businesses since the beginning of 2022.
Budget 2024 included a personal income tax package amounting to €1.3 billion in 2024 and €1.5 billion in a full year and was built around 3 key pillars: changes to tax credits, the standard rate band and Universal Social Charge (USC). The tax package was designed in a manner, which allowed the Government to use these levers to distribute the benefit of the package as effectively as possible. For the third year in a row, the main tax credits and the Standard Rate Cut-Off Point were increased. In addition, the package also focused on tackling child poverty by providing a suite of tax enhancements to assist families with children. For example, the Home Carer Tax Credit, Single Person Child Carer Credit and the Incapacitated Child Tax Credit were also increased by around 6.0 per cent.
Furthermore, the 4.5 per cent rate of USC was reduced to 4.0 per cent and the ceiling of the band for the 2 per cent rate of USC was increased to €25,760 (from €22,920) in line with the increase in the National Minimum Wage.
Government will set out the parameters for Budget 2025, including the size of any tax package, in the upcoming Summer Economic Statement. My officials are working closely with officials from the Department of Public Expenditure, National Development Plan Delivery & Reform on the drafting of the Statement.
As the Deputy will appreciate, it is a longstanding tradition not to comment in advance of the Budget on any matters that might be the subject of Budget decisions.
