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budget 2024
Cuts to USC under consideration as part of Budget, confirms Tánaiste
Budget talks are set to intensify next week.
CUTTING THE UNIVERSAL SOCIAL CHARGE (USC) is an option being considered in this year’s budget, according to Tánaiste Micheál Martin.
Speaking at the Fianna Fáil party think-in in Tipperary today, Martin said:
“We’re looking at all options, including USC.”
In recent months, Fianna Fáil politicians have been putting pressure on Finance Minister Michael McGrath to reduce the much-hated USC.
Speaking to reporters this afternoon, McGrath said he is “doing a trawl right through the entire taxation code to see what opportunities there may be to be more innovative and creative with the taxation system.
“I am examining the role the USC can play in that regard,” he said, but added that there is no final decision.
“The income tax package will be the largest and most important part of the overall tax package in the Budget and from our point of view, the important thing is that we achieve the fairest and most equitable distribution of the benefit of the tax reductions,” McGrath said.
Budget talks set to intensify next week with budget day just under one month away. Public Expenditure Minister Paschal Donohoe told RTÉ’s Morning Ireland that the decision to cut the USC lies with the finance minister.
“We have changed Universal Social Charge before. We are many weeks away from the Budget being decided and Minister McGrath and I will work co-operatively and closely together on it. Universal Social Charge has been reduced in the past,” he said.
The USC was introduced in December 2010 by the then-Finance Minister Brian Lenihan at the height of the financial crisis. The measure came into effect on 1 January 2011.
At the time it applied to all gross incomes over €4,004, with the threshold increasing over the following years.
Energy bills
In his opening speech to the party members today, Martin strongly indicated that another energy credit is on the way for households.
“We acted last year, particularly to help people with paying energy bills and to support the incomes of the most vulnerable in our society.
“While there have been some energy price reductions made , prices remain too high , we know people are still facing pressure and we will act to help them again,” Martin said.
The Tánaiste said there will be a combination of actions to help people with major price increases and action to try to reduce pressures pushing up prices.
He told reporters that the cost-of-living crisis is the “big issue facing people now”.
“We’re going to look at a range of measures to try and alleviate pressures on people. Some of that is to tax relief. We’re looking at all options and including USC and also then reducing costs in terms of services, which we have done with the expansion of GP cards,” said Martin.
