What Budget 2026 means for you — welfare boosts, new housing funds, and tax changes
Finance minister Paschal Donohoe (right) and public expenditure minister Jack Chambers (left) outside Government Buildings, Dublin, ahead of the budget.
Finance minister Paschal Donohoe and public expenditure minister Jack Chambers have delivered Budget 2026, outlining major spending and tax changes for the year ahead.
Here's everything you need to know.
The total social protection budget is nearly €30bn, an increase of over €2bn on last year.
There will be a €10 weekly increase to all core social welfare rates, bringing the jobseeker’s allowance to €254. A double Christmas bonus will also be paid to long-term recipients.
The fuel allowance will be extended to 50,000 families receiving the working family payment, with the income threshold rising by €60 per week.
The carer’s allowance income disregard will increase to €1,000 for a single person and €2,000 for a couple.
The child support payment will increase by €8 per week for children under 12, and €16 for those aged 12 and over. The hot school meals programme will continue to be rolled out to all remaining primary schools.
The overall tax package totals €1.3bn, including €150m in targeted supports for vulnerable groups.
From January 1, there will be targeted changes to the universal social charge (USC), coinciding with a minimum wage increase to €14.15 per hour.
The 2% USC rate band will rise by €1,318 to €28,700, and the USC concession for medical card holders will be extended for two more years.
For businesses, the Vat cut for the hospitality sector to 9% will take effect on July 1, while the 9% Vat rate on gas and electricity bills will be extended until the end of 2030.
The bank levy will also be extended until the end of 2026.
The price of a 20-pack of cigarettes will rise by 50c from midnight, bringing the average price to nearly €19.
A 50c per millilitre tax on nicotine-containing vape e-liquids will take effect on November 1, adding €1 to disposable vapes and doubling the cost of 10ml refill bottles from €5 to €10.
Carbon tax will increase to €71 per tonne of CO₂, adding about 2c per litre to petrol and diesel.
A VRT relief for electric vehicles will be extended until the end of 2026.
€11.3bn has been allocated to the Department of Housing, including €2bn for social housing and €7.2bn in capital funding.
This includes €2.9bn for new-build social homes and the second-hand acquisitions programme, and €1.2bn for a new starter home scheme.
€140m is being allocated to retrofit social homes, and €130m will fund 17,000 home adaptation grants for older people and those with disabilities. A further €205m is set aside for a new housing infrastructure fund.
The Vat on completed apartment sales will drop from 13.5% to 9% until the end of 2030. A new 7% derelict property tax, based on market value, will replace the existing derelict site levy.
The rent tax credit of €1,000 per year will be extended for three years, and mortgage interest relief will continue until 2027.
€1.4bn is being provided to Uisce Éireann to support housing development and improve water infrastructure.
The health budget will increase by €1.5bn, bringing the total allocation to €27.4bn.
This will fund 220 new hospital beds, 280 community beds, 500 nursing home places, and 1.7 million additional home support hours. Extra resources will also be directed to mental health services.
The Department of Education will receive €13.1bn, providing for 1,717 new SNAs, 1,042 teacher posts, and 860 new special education teachers.
€1.6bn in capital investment will support more than 300 school building projects.
At third level, 108,000 students will benefit from a permanent €500 cut to the student contribution fee, while 1,100 new college places will be created.
€810m is being allocated to third-level capital projects.
The Department of Children’s budget includes funding to extend the national childcare scheme to 35,000 more children, bringing total spending to €1.5bn next year.
€3.8bn will be allocated for disability services, enabling:
- 250 new residential places;
- 1,400 day services for young people and 50 for older adults;
- 6,500 extra assessments of need;
- 150,000 home support and personal assistance hours.
€4.7bn will be invested in transport projects next year, including the M28 Cork–Ringaskiddy road, Dart+, BusConnects, MetroLink, and the Cork Area Commuter Rail.
Funding will also go towards greenway and active travel projects countrywide.
The Department of Justice will receive €6.17bn, allowing for the recruitment of up to 1,000 trainee gardaí and an additional €19m for garda overtime.
€39m is being allocated to the Prison Service, €11m to the Courts Service, and €6.7m to the Probation Service.
An additional €11.5m will fund domestic and gender-based violence initiatives.
Mr Chambers confirmed there would be €1.49bn going towards the Department of Defence for 2026.
While this will include key measures like recruitment of 400 new Defence Forces members, and 50 more civilian posts, it also includes provision for a new uniform for Irish soldiers. This is set to be paid out of a €276m pot, which includes the purchase of equipment and enhanced recruitment advertisements among others.
- The digital games tax credit will be extended for six years;
- €3m will support the establishment of League of Ireland academies;
- A new visual effects tax credit will offer 40% relief for productions with at least €1m in qualifying expenditure, capped at €10m per project.
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