Jack Chambers has defended his budget as “progressive” despite cutting taxes for people on high incomes.
Research by Newstalk’s Budget25 partner Grant Thornton has concluded that the tax cuts announced in the budget mean an ‘average’ person on an income of €36,000 will pay €333 less in tax next year.
By contrast, someone earning €100,000 will pay €1,009 less in tax, while a freelancer earning €150,000 will be €1,234 better off.
On The Hard Shoulder, the Finance Minister said the Government was keen to lower the tax burden for people on low and middle-incomes.
“When you take the wider income system, we’ve a lot of low and middle-income earners who pay a significant amount of income tax,” Minister Chambers said.
“We have a very progressive income tax system and I think what we decided to do today is to adjust across the three areas to make sure that low and middle-income areas, as their wagers are rising that they don’t slip into the higher rate of income tax and they don’t make that extra amount of USC when they’re working in our economy.
“The income tax package has been progressive in that sense."
Social welfare
The Government also announced a number of lump sums for people on low-incomes - such as a €400 disability support grant, a €400 carer's support grant and a €300 fuel allowance payment.
However, some measures, such as two double payments of child benefit will be paid to households regardless of wealth.
Minister Chambers said if the Government does not believe child benefit should be means tested.
“There are people that just fall outside the thresholds and the bands when it comes to social protection measures,” he said.
“Child benefit is a universal measure where we thought it was important to cushion those households that don’t get supports.
“I’m talking about the ones on the margin above the social protection system.”
The budget also included a €35 million women's healthcare package which means certain treatments - such as HRT - will be made free to people in all income brackets.
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Main image: Finance Minister Jack Chambers (left) and Public Expenditure Minister Paschal Donohoe with Budget 2025 at the Department of Finance in Dublin, 30-09-2024. Image: PA Images / Alamy
