Dublin: The Government has published its Summer Economic Statement (SES) ahead of the October Budget, outlining plans for a €1.5 billion tax package and a €7 billion increase in public spending next year.
The statement, released by Finance Minister Simon Harris and Public Expenditure Minister Jack Chambers, sets out the government’s fiscal priorities for Budget 2027, with a focus on supporting workers, strengthening public services, and investing in long-term infrastructure.
The government plans to increase overall expenditure by €7 billion next year, comprising:
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€5.9 billion in additional day-to-day (current) spending.
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€1.1 billion in additional capital investment for infrastructure.
This will bring total government expenditure to approximately €125 billion by 2027.
The statement projects a 5.9% increase in spending compared with the revised 2026 expenditure ceiling, keeping public finances broadly in line with the government’s medium-term fiscal framework.
The Summer Economic Statement confirms that €1.5 billion has been allocated for tax measures in Budget 2027.
Among the measures expected to be announced are:
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An increase in the income threshold for the 40% rate of income tax.
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Higher personal tax credits to reduce the tax burden on middle-income earners.
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Measures aimed at ensuring workers retain more of their earnings.
Warning Over Corporation Tax Dependence
Despite Ireland’s strong fiscal position, the government has again highlighted the risks associated with the country’s heavy reliance on corporation tax revenues.
Ireland is projected to record a budget surplus of €9.2 billion this year. However, the statement notes that excluding excess corporation tax receipts, the state would face an underlying deficit of €10.8 billion.
The report also points out that more than half of Ireland’s corporation tax revenue comes from just 10 multinational companies, underlining the vulnerability of public finances to changes in global corporate activity.
To reduce these risks, the government intends to:
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Maintain strong budget surpluses where possible.
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Transfer surplus revenues into two long-term national savings funds.
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Continue investing in critical infrastructure projects.
While the government said Ireland entered the year in a strong financial position, it warned that geopolitical instability, particularly the conflict in the Middle East, continues to pose economic risks.
Public Expenditure Minister Jack Chambers said the government’s priority is to deliver a tax package that supports workers while maintaining sustainable public finances.
He added that Budget 2027 will continue to focus on:
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Public service reform.
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Improving service delivery.
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Increased investment in infrastructure and capital projects.
Finance Minister Simon Harris said Ireland’s economy remains resilient but stressed the importance of remaining flexible in the face of global uncertainty.
Responding to recommendations from the Irish Fiscal Advisory Council, the government indicated that temporary cost-of-living supports introduced during the energy and inflation crisis will gradually be phased out.
Ministers have signalled that universal electricity credits and broad cost-of-living payments are unlikely to return, with the focus instead shifting towards targeted and long-term support measures.
Budget Priorities
The government is expected to prioritise:
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Raising income tax thresholds and tax credits.
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Further reducing childcare costs.
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Increasing eligibility thresholds for childcare subsidies.
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Expanding childcare facilities.
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Higher social welfare payments, including pensions.
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Improved financial support for family carers and people with disabilities.
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Additional measures to tackle child poverty.
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New annual supports to help meet the extra living costs associated with disability.
Long-Term Investment
The Summer Economic Statement also reaffirms the government’s commitment to long-term capital investment, with additional funding planned for:
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Housing development.
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Public transport.
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Road infrastructure.
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Energy projects.
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Health services.
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Education facilities.
Rather than relying on temporary financial supports, the government said its objective is to strengthen public services and infrastructure while maintaining sustainable economic growth in the years ahead.
Irish Samachar English