What can we expect from Budget 2026?

Ellen O'Donoghue

With Budget 2026 set to be announced on Tuesday, there has been much speculation about what people will or will not get.

In contrast with recent years, the Minister for Finance has said there will be no personal tax cuts, and many workers will face higher tax bills.

The Government have also said there will be no once-off cost-of-living payments this year, as the focus is on trying to address some of the country's infrastructure deficits.

There are plans, it has been reported, to spend over €9 billion in this budget, but where will it go?

A possible cut to third-level student fees and a welfare Christmas bonus have not been ruled out, but many households stand to get less in their pockets this year than in recent budgets.

It has been hinted, however, that there will be a hospitality VAT rate reduction from 13.5 per cent to 9 per cent. It may not be brought in until July 2026, though.

There are also fears that the reduction would result in higher taxes for workers due to inflation.

Recommendations submitted this year for the budget included a raise in the youth minimum wage.

Newstalk's political correspondent Sean Defoe said that the budget will "feel like a disappointment for a lot a people."

Working people will not have the benefit of an income tax package for the first time in a number of years, and there will be no widespread cost-of-living one-off benefits like previous years.

Workers will lose out to tax cuts for the hospitality sector, though they will not kick in until the middle of next year, Mr Defoe said.

He said a VAT rate for the construction of new apartments is also on the cards.

Students are unlikely to get the €1,000 cut to fees seen last year, but they may get a more permanent cut of €500.

But students whose families earn less than €100,000 a year are then eligible for at least a further €500 off through the SUSI grant.

The Government had committed to reducing college fees, but faced criticism earlier this year when suggesting the contribution fee would return to €3,000.

Core social welfare rates look set to rise, but not by as much as in Budget 2025.

The cost of a packet of cigarettes is also set to increase by 50 cents, bringing the cost of an average pack up to €18.95, among the highest in Europe.

The Irish Sun has reported that a similar increase is expected to be applied to vapes.