Budget 2025: What we know so far – from tax cuts to pension increases and free schoolbooks

Minister for Finance Jack Chambers will deliver his first budget on Tuesday but already we know the shape of it.
There is about €1.8 billion for brand new spending, €1.4 billion for tax cuts and up to €2 billion for once-off measures – plus €3 billion for infrastructure spending from AIB proceeds. Here are the main features:
Budget tax measures amounting to €1.4 billion were flagged by the Government in the summer economic statement earlier this year. In Budget 2025, we are expecting:
[ Budget 2025: Taxpayers in line for significant income tax and USC cutsOpens in new window ]
The social welfare budget always goes down to the wire, and this year looks to be no different.
A further 25 per cent cut in the average cost of childcare has kicked in and there appears to be no talk of increasing the hourly subsidies or cutting costs further. The focus instead looks to be on core funding, Deis funding and disability funding.
There will be a 24 per cent increase in funding for childcare, with €1.34 billion agreed given to account for the growing number of children in the system and to provide more income for creches that have been subject to a fee freeze.
A total of €17 billion between Apple and AIB share proceeds needs to be spent – but we won’t get firm indications on what, beyond a certain level.
One thing that is over the line is another €1.25 billion for the Land Development Agency to increase its homebuilding targets by 4,000.
Expect high-level indications of where this money is going to end up – water and electricity are big sticking points, so Irish Water and EirGrid will likely be beneficiaries.
The big question is how much will be allocated to Minister for Housing Darragh O’Brien’s various schemes, which is likely to be a function of funding levels given to other departments.
In terms of new measures, one source said last week housing will be more like a “few sprinkles on top, rather than a whole new knickerbocker glory”. In that space, we have the rent tax credit mentioned above, and the Help to Buy scheme will be extended until 2029 – however, moves to expand it for renters have not been approved, with higher grants for dereliction works still on the table.
Funding to maintain existing levels of service in the health service for 2025 has been agreed as far back as the summer economic statement in July with funding of almost €1.2 billion being earmarked.
Aside from that, high on the list of budget asks from Fianna Fáil Minister for Health Stephen Donnelly is funding to staff extra beds in the system. Some 300 hospital beds alone could open next year, provided the funding is there to staff them. Expansion of State-funded assisted human reproduction has been floated, though it is uncertain if this will be included. Free prescription contraception to women over the age of 35 has also been under consideration. Extending the scheme to 16-year-olds – which is said to be “legally complex” – is not expected to happen in Tuesday’s budget.
Fianna Fáil Minister for Agriculture Charlie McConalogue is understood to be pushing for improved schemes to support a wide variety of farmers including those with sheep, beef and dairy/beef farms.
He wants to see supports for sheep farmers increase by €5 to €25 per ewe and funding is also set to be secured for the €100-per hectare support for tillage farmers who planted in 2024. Talks also focused on ensuring funding for existing agriculture schemes such as the Acres payment to support environmentally friendly farm practices, which saw 55,000 farmers sign up – 10 per cent more than originally envisaged.
There will be new investment for tackling domestic, sexual and gender-based violence, expanding prison capacity, and speeding up the processing of international protection cases.
– In a major policy play, Minister for Justice Helen McEntee has secured funding for 1,100 additional prison spaces over the next five years in existing prisons. She is also preparing the Curragh as a new prison, with Thornton Hall being reviewed as a possible further prison location. The capital budget for the Irish Prison Service will rise by over 70 per cent next year to deliver the expansion plan.
– Hundreds of additional staff are to be recruited in prisons, including new prison officers. Some 200 additional staff are being hired for the remainder of this year, with 150 being hired next year.
– Ms McEntee is also seeking money for Garda recruitment, with funding for 800-1000 extra gardaí and raising the Garda training allowance to €354.
– For the Defence Forces, a lot of investment has already been allocated under the approved modernisation plan, and there will be an extension of the seagoing Naval personnel tax credit for another five years in the budget. There will be funding for hundreds more personnel, cash for external expertise, and capital funding for new radar and subsea capabilities, with a “record allocation” promised overseas development in the Department of Foreign Affairs.
Next to nothing has so far emerged from the talks between the Minister for Tourism, Culture, Arts, Gaeltacht, Sport and Media Catherine Martin (Greens) and Paschal Donohoe (Fine Gael), the Minister for Public Expenditure and Reform.
It is known that the budget will include €42 million in exchequer funding for cash-strapped and controversy-hit RTÉ along with an expected €78 million worth of free TV licences to groups such as pensioners. Martin confirmed on Wednesday she is not seeking any additional money for RTÉ.
Despite an ambition to expand the basic income for the arts scheme, Martin says the outcome of the pilot scheme is awaited so it will be kicked out for the next government to handle.