Families are the big winners this year.

Minister for Finance Jack Chambers delivered his first budget this afternoon, unveiling a number of welcome announcements designed to put money back in the pockets of hard-pressed parents and workers.

The €8.3bn Budget 2025 package includes increases in all social welfare payments, a triple child benefit payment for families with newborns and extra payments for carers and people who live alone.

In his opening address, Minister Chambers said the economy is in “good shape”, but noted that he recognised that many are still struggling with high prices.

‘A budget that supports children’

There is plenty of praise for the family focus this year.

”We’re going to see benefits kicking in as soon as a child is born, in terms of child benefit, but also in terms of extra supports in education and college as children grow up.” Minister for Children, Roderic O’Gorman.

“Overall it is a budget that supports children, supports families and supports our planet.”

Not everyone is thrilled. In another blow for the industry, VAT on hospitality will remain at 13.5 per cent. The Irish Hotels Federation (IHF) expressed deep disappointment with the measures.

“These half-baked measures fall far short of what is needed to address the enormous challenges facing hospitality businesses.” said IHF President Michael Magner.

“They demonstrate how out of touch policymakers in Government are with the commercial reality facing hospitality businesses.”

Here’s the breakdown of today’s Budget 2025 announcement:

Social welfare

• All welfare payments, including pensions, will be increased by €12 a week.

USC and Minimum Wage

• The Universal Social Charge will be cut by one per cent to three per cent and the income tax threshold will rise by €2,000.
• The main tax credits will also increase by €125, including Personal, Employee and Earned Income Credits.
• The minimum wage is set to increase by 80c to €13.50 per hour starting on January 1st, 2025.

Child Benefit 

• Each child in Ireland will receive €280 in additional child benefit, with two double payments before Christmas in November and December.
• Parents of newborn babies will receive a once-off, triple child ‘baby boost’ benefit payment of €420.

Children and childcare

• Maternity, paternity and adoptive benefit will be increased by €15 per week.
• Free schoolbooks up to Leaving Cert, expanded special needs support, and waived fees for Junior and Leaving Cert.
• The current IVF scheme will be expanded, expected to include donor-assisted IVF and couples who are experiencing secondary infertility.
• The hot meal programme will be extended to all primary schools in Ireland in 2025.

Health

• Women in Ireland experiencing menopause will receive free Hormone Replacement Therapy (HRT). This represents a saving of over €800 a year for many women.

Transport

• All over-70s in Ireland will be allowed to invite a friend to join them for free on public transport.
• Children aged from five to eight years-old will enjoy free public transport, starting in summer 2025.

Housing

• Mortgage interest relief will be extended for another year.
• The Help to Buy scheme has been extended until 2029.
• The Inheritance tax threshold, transferring from parents to children, will be raised to €400,000 from €335,000
• The renter’s tax credit will increase from its current level of €750 to €1,000. Oh – and it’s backdated to 2024.
• The existing rate of 1% stamp duty will continue to apply to property values up to €1 million.
• The Vacant Homes Tax is being raised from 5 to 7 times the current base Local Property Tax rate.
• A total of €2 billion will be allocated in 2025 to deliver 10,000 newly built social homes.

Energy 

• Two universal electricity credits of €125 will be paid to all households before the end of the year.

Hospitality

In a blow for the industry, VAT on hospitality will remain at 13.5 per cent.

The Irish Hotels Federation (IHF) today expressed deep disappointment with the measures reported in advance of Budget 2025, saying the decision not to reduce the hospitality VAT rate is short-sighted and extremely concerning given the stark commercial environment that food service businesses are operating under.

IHF President Michael Magner says: “The measures reported would do next to nothing to address the enormous challenges confronting our sector while at the same time imposing further costs on thousands of hospitality businesses.”

Cigarettes, vapes and alcohol

• While there is no change in the price of a pint, cigarettes will go up by €1, bringing the average pack to €18.05 from midnight tonight.
• Vapers will see a new tax on e-liquid in 2025, an extra 50c per ml. The new tax will bring the price of disposable vapes to around €9.23 including VAT.