All the Latest news and updates on Budget 2014
Finance Minister Michael Noonan has announced #Budget2014
Read the summary of Budget 2014 here
#Budget2014 THE FACTS AND FIGURES
McCarthy Accountants have sorted through the details please see the key points below
#Budget2014 involves €2.5bn in spending cuts and tax increases
No tax relief on top range private health insurance plans
Prescription charges for medical card holders increased
Bereavement Grant to be discontinued
No change to basic social welfare rates
€100 Jobseeker’s Allowance rate extended
“The purpose of the Budget is to continue progress we have made; to reinforce policies that grow the economy; to establish the conditions which will create jobs; and to prepare for exiting the bailout programme” Minister Noonan, Budget 2014 Speech – 15th October 2013.
2014 Budget is:
- Introducing 25 pro-business and pro-jobs measures, costing in excess of €500 million, aimed at creating jobs.
- Continuing to support the tourism sector by keeping the reduced 9% rate of VAT which was due to return to 13.5% at the end of 2013 and by also abolishing Air Travel Tax from 1st April 2014.
- Increasing the farmers’ flat rate addition from 4.8% to 5% from 1st January 2014 to compensate farmers for VAT incurred on their farming inputs.
- Extending CGT retirement relief to disposals of long-term leased farmland in certain circumstances to encourage older farmers to lease out their farmland.
- Introducing a home renovation tax incentive scheme which will provide an income tax credit to homeowners who carry out renovation and improvement works on their principal private residences in 2014 and 2015.
- Extending the Living city initiative to Cork, Galway, Kilkenny and Dublin and broadening the eligibility criteria to include all buildings built prior to 1915.
- Extending the purchase period from 2013 to the end of 2014 exempting property from CGT if held for at least 7 years.
- 100% committed to the 12.5% corporation tax rate.
- Bringing forward a change in the Finance Bill to ensure that Irish registered companies cannot be ‘stateless’ in terms of their place of tax residency.
- Supporting the creation of new businesses under the “Build Your Business Initiative”
The deficit target (4.8% for 2014) and initiatives to support jobs require €1.2 billion of additional tax revenue. €500 million is carried over from Budget 2013; therefore €700 million of new measures is required in Budget 2014. This will be achieved by:
- Abolishing top slicing relief
- Capping medical insurance relief to €1,000 per adult and €500 per child
- Replacing the “one parent family tax credit” with a new “single person child carer tax credit”
- Abolishing tax relief for acquiring an interest in a partnership
- Increasing the excise duty on a packet of 20 cigarettes by 10 cent from midnight 15th October 2013
- Increasing the excise duty on a pint of beer, cider and spirits by 10 cent and a 75cl bottle of wine by 50 cent from midnight 15th October 2013
- Increasing the DIRT and exit tax from 33% to 41%
- Introducing a levy on the banking sector
- Reducing the Standard Fund Threshold from €2.3 million to €2 million from 1st January 2014 for Pension Funds
- Introducing a 0.15% levy on pension funds for 2014 and 2015 as the 0.6% Pension Levy introduced in 2011 will be abolished from 31st December 2014. Therefore in 2014 there will be a levy of 0.75%, reducing to 0.15% in 2015.
There will be no increases in:
- Income tax or the Universal Social Charge
- The 9%, 13.5% or 23% VAT rates
- Excise duty on petrol, diesel or on home heating oil or gas.
One of the primary tasks of the Budget is to exit the Bailout Programme which Minister Noonan believes will be achieved by January 2014. Also, only time will tell if the above measures create job growth and return Ireland to financial and economic stability.