Key Takeaways
| Area | What We Know | Potential Impact |
|---|---|---|
| Budget size | €9.4 billion total | €7.9bn spending, €1.5bn tax cuts |
| Cost-of-living supports | No one-off payments this year | Focus shifts away from short-term relief |
| Taxes | Likely rise in higher-rate income tax threshold or USC cut | Slightly more take-home pay for workers |
| Welfare | Supports targeted at vulnerable households | Some protection for low-income groups |
| Housing link | Focus on infrastructure spending | Possible space for housing investment, but risks being squeezed by VAT cut and limited fiscal room |
Budget day is coming ( October 7th ), and we will see Ministers Paschal Donohoe and Jack Chambers unveil Budget 2026, a €9.4 billion package. For comparison, 2025’s budget was €10.5 billion.
According to Irish Times, some things are already clear – €7.9 billion will go into spending and €1.5 billion into tax measures.
Unlike last year, there will be no once-off cost-of-living supports. These supports included:
- €250 energy credit for households
- €300 Fuel Allowance lump sum
- and a €400 lump sum for recipients of the Carer’s Support Grant, Disability Allowance, and other benefits
This time around, the Government will focus on infrastructure and targeted help for the most vulnerable households.
So how does this tie into the housing crisis?
That’s the question on most people’s minds (including myself), and one the Government cannot afford to dodge.
The Headline Measures for Budget 2026.
1. No More One-Off Payments
As listed above, last year’s energy credits and lump-sum welfare boosts are not coming back.
While I’m willing to understand the need for cuts in principle, this unfortunately means many homes struggling with rising rents, mortgages, and energy bills will feel less cushion this winter.
2. Tax Cuts
Government is weighing two options:
- Raising the higher-rate income tax threshold – (letting more income stay at the lower 20% rate. Right now, it’s at €44,000).
- Cutting USC (Universal Social Charge) – reducing deductions from pay packets.
Either would leave workers with a little more money in their pockets, but these cuts are still modest in the context of rising housing costs.
3. Welfare Targeting
There will be some targeted increases for low-income households.
This is important, especially for families dependent on Housing Assistance Payment (HAP) or rent supplement. But again, it doesn’t fundamentally address housing supply.
4. VAT and Hospitality
The Government is expected to cut hospitality VAT back to 9% from 13.5%, a move costing at least €650 million.
That’s money not being directed to strategic social housing, rent relief or other anti-poverty measures for irish residents.
***UPDATE – The budget just revealed that the VAT reduction also extends to apartment sales to 2030. To read on that, click HERE.
The Connection to the Housing Crisis.
So, where does housing fit into Budget 2026?
So far, this is what I can tell:
- Infrastructure Spending
The €7.9 billion spending pot is tilted towards infrastructure. This could include housing construction, ie, social housing. But unless housing is explicitly prioritised, it is more likely that funds will go to other areas where support is also needed (roads, transport, hospitals), leaving housing in the same undesirable state.
2. Missed Opportunity on Renters
Renters are not getting direct cost-of-living payments this year. That leaves the Rent Tax Credit (which ends in 2025) and Tenant-in-Situ scheme as the main support tools. While they are both important, they are still far from enough when rents keep rising.
3. Domestic Violence and Refuge Spaces
The Irish Examiner recently linked the housing shortage to rising domestic violence risks. Budget 2026 is a chance to ring-fence funds for new refuge spaces and trauma-informed housing for survivors.
If ignored, this could become one of the State’s most glaring policy failures.
4. Council Powers and Zoning
The Taoiseach has threatened to bypass councils refusing to rezone land for housing. Budget 2026 could provide the funding muscle to make that credible, but only if the Government actually follows through this time.
My Take – (€14bn Apple Tax Windfall Anyone??)
Are we just going to pretend that the Irish Exchequer didn’t finally collect the 14bn owed by Apple in May? Irish Times
I’m genuinely confused as to the radio silence around this money. That money gives the State a once-in-a-generation opportunity to act boldly, not timidly.
Tax cuts and modest welfare boosts are welcome, but they are tiny drops in the ocean compared with the scale of the housing crisis. The mere existence of that windfall makes any underinvestment in homes, infrastructure, or supports an outright political choice; not a budgetary necessity.
If the Government fails to deploy a meaningful chunk of that money into social and modular housing, and supports for vulnerable renters, it will expose its priorities, which is to protect corporate tax gains over protecting lives.
As far as I am concerned, the public narrative of “scarcity” is starting to fall flat when there is clearly money to do more.
But hey, what do I know? I’m just a guy with a laptop.
Conclusion.
Budget 2026 could be a turning point for the coalition governement, or just another missed opportunity. The Government cannot credibly argue in 2025 that “we don’t have the funds.” It must now show that its values align with its resources.
Here’s what an honest, justice-driven budget would look like:
- Substantial investment in social housing supply, as well as other vital infrastructure in general (transport, water services, healthcare, etc.).
- A significant, ring-fenced slice of the money dedicated to refuge expansion and trauma-informed housing.
If October 7th passes with more big talk than real housing impact, the result will be a deeper erosion of trust in government. The resources are there; now the political will must catch up.
