The eagerly awaited 2018 Budget was introduced by Minister Pascal Donohoe, in his first Budget speech, to the Dail on the 10 October 2017. From an economic perspective, the Irish economy has recovered strongly from the time of the downturn and is back in good stead with a growth of 4.3% estimated for 2017 and projected growth of 3.5% in 2018.
Most of the key indicators in the economy are very positive with unemployment expected to fall to 6.1% in 2017, and further declining to 5.7% in 2018 and consumer spending growth for 2018 expected to be 2.3%. With the exception of the challenges of Brexit and the housing crisis, the economy is performing quite well. The increased fiscal space permitted the Minister to announce a range of spending increases across most areas.
The announcement of the new entity, Home Building Finance Ireland, and other measures to increase the supply of residential property should have a beneficial impact but is likely to take some time to gather proper traction.
The provision of an SME loan scheme of up to €300m is a positive development in supporting many companies that will be impacted by Brexit.
The increased fiscal space is partly being funded by the increase in Stamp Duty on commercial property from 2% to 6% and it remains to be seen how this will be received by foreign buyers in particular as an increase of this size could adversely impact on current and proposed property developments and transactions.
In the overall since most people will have benefitted from the 2018 Budget and it has the old-fashioned look of a pre-election type offering.