Senator Garret Ahearn said Fine Gael in Government is supporting average and middle-income
earners to meet the rising cost of living through income tax changes. The tax package was announced
by Minister for Finance Paschal Donohoe in October as part of Budget 2022.
Senator Garret Ahearn continued, “Fine Gael is on the side of the average and middle-income earner
who is dealing with the rising cost of living. The tax changes announced by my colleague Minister
Paschal Donohoe in the Budget, come into effect on the 1 st of January and will benefit everyone who
pays income tax, supporting people and families in Tipperary.
“These are tangible changes that everyone will feel the benefit of in their pocket throughout 2022. The
standard rate band for all earners will rise from €35,300 to €36,800 for single earners, from €39,300 to
€40,800 for one-parent families; and from €44,300 to €45,800 for couples. There is also a €50 increase
in each of the main tax credits – personal tax credit, employee tax credit and the earned income credit.
“There is also a change to the Universal Social Charge- the 2% rate band ceiling will increase in line
with the increase in the national minimum wage from €10.20 to €10.50 per hour. This was the eighth
increase in the minimum wage under Fine Gael in Government and we wanted to ensure that full-time
workers benefiting from the increase will remain outside the top rate of USC.
“As well as the tax changes, Fine Gael also prioritised spending measures in Budget 2022 to help
combat the cost of living and add to our quality of life. We introduced a €5 increase in Social Welfare
payments across the board including disability payments, pensions and working age payments. The
Fuel Allowance increased by €5 per week and the Living Alone Allowance increased by €3 per week.
“Fine Gael is committed to tackling the rising cost of living and the tax changes coming into effect this
week will be felt by individual earners and families in Tipperary.”
NOTE TO EDITORS
Examples of tax changes
Example 1
Patrick is single and working 39 hours a week (approximately) on the minimum wage as a call centre
operator. Patrick will see a gain of €421 in his annual net income due to this Budget.
Example 2
Danielle and Chris are married with two children, Molly aged 10 and Alanna aged 13. Danielle is
employed in the tourism sector earning €47,000. Chris works in the family home. The family will see a
gain of €465 in their annual net income due to this Budget.
Example 3
Mairéad is single and works in the hospitality sector earning €30,000 a year. Mairéad will see a gain of
€115 in her annual net income due to this Budget.
Example 4
Marie is single and works as a HR advisor earning €50,000 a year. She is currently working from home
and works from home 100 days in the year. Her electricity and heating bill for the year is €1500 and her
broadband for the year is €480. Marie claims her remote working expenses as vouched expenses.
Marie will see a gain of €449 in her annual net income due to this Budget, of which €33 is additional tax
relief for remote working.
Example 5
Denis is 68 years old and retired. He receives the Contributory State Pension and has a private
pension of €16,000 per annum. He will see a gain of €308 in his annual net income due to this
Budget.
Example 6
Roan and Nicole are married with one child, Joseph, aged 7. Roan is self-employed and earns €40,000.
Nicole works in the family home. The family will see a gain of €165 in their annual net income due to
this Budget.
Example 7
Fiona is single and works in the financial services sector earning €60,000 a year. Fiona will see a gain
of €415 in her annual net income due to this Budget.
Fiona is buying a new build house in 2022 and will be availing of the Help to Buy (HTB) incentive. The
HTB is a scheme to assist first-time purchasers with a deposit they need to buy or build a new house
or apartment. The incentive gives a refund on Income Tax and Deposit Interest Retention Tax (DIRT)
paid in the State over the previous four years, the following limits apply per property:
. €30,000
. 10% of the purchase price of a new home (For self-builds 10% of the completion value of the
property), or
. the amount of Income Tax and DIRT paid in the four years before the purchase or self-build.
If Fiona qualifies for the scheme, and providing she has paid a similar amount of Income Tax over the
previous 4 years she could potentially avail of a maximum of €30,000 of a refund in her income tax
towards the purchase of her new house.
