Measures announced as part of Budget 2025 will result in small income gains on average next year, the ESRI has forecast.
In the body’s post-budget briefing they said the package of tax cuts, welfare increases, cost-of-living measures and indirect tax cuts has grown broadly in line with forecast wage growth of 4.2% for 2025, compared to the 2024 package.
However, they noted there is variation in how it will affect households of different income levels, with smaller gains for middle income households.
According to the Economic and Social Research Institute (ESRI) most elements of the tax-benefit system will be increased broadly in line with forecast income growth in 2025.
However, some elements of the system, such as child benefit, the living alone allowance and fuel allowance have been frozen in nominal terms.
These, together with the PRSI increase planned for 2025, will lead to small income losses for some households, compared to a budget indexed to forecast income …