Budget 2026 (Enterprise, Tourism and Employment): Statements
Seanad Éireann — 2025-10-14
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Peter Burke (FG), Longford-Westmeath

I welcome the opportunity to address Senators today and make a few comments regarding budget 2026, particularly the budget measures that relate to my own Department. Budget 2026 is a strongly pro-jobs, pro-enterprise budget. The signal has gone out that Ireland is a fantastic place in which to do business, to scale and to invest. We must ensure that our economy and workforce continue to reap the benefits that the enterprise economy brings.
The budget demonstrates the Government's commitment to ensuring that our economy delivers for our citizens and that we support our people and businesses through investment and sensible management of our finances.
The fact that we have a record number of over 2.82 million people in work and that our economy continues to enjoy very healthy levels of growth, notwithstanding strong geopolitical headwinds, is a testament to the hard work of the Irish people and the benefits of Government budgetary policy.
The package of budget measures announced continues our dual approach of safeguarding the national finances while also providing supports to targeted areas. Our aim as a Government must always be to improve the lives of our people. Focusing on quality employment and keeping businesses viable provides a pathway for people to access meaningful opportunities which provide economic stability and enhance quality of life.
Resilient, productive economies do not happen by chance, and our business ecosystem requires smart intervention to future-proof our industries and jobs. We have seen how careful, considered management over the last decade has strengthened our economy, and we must continue on this pathway to ensure we do not get complacent as we prepare to take advantage of the next wave of technology and advancement.
The reduction in the hospitality VAT rate to 9% will benefit all food businesses, which are integral parts of every town and village in the country, providing valuable employment in their local communities. While a significant support, the hospitality VAT rate reduction amounts to 18% of the overall tax package and is an appropriate lifeline to our hospitality SMEs when it comes to viability and value. This sector accounts for almost 200,000 jobs, with many of those workers on the national minimum wage. Some 75% of these businesses have fewer than ten employees and just 0.4% of hospitality SMEs are considered large businesses or food chains.
I will now outline some of the other pro-business tax measures in budget 2026. There is an increase in the rate of the R and D tax credit from 30% to 35%, which will be of huge benefit to our innovative industries, increasing investment and employment in pharma, medtech, engineering and more in the coming decades. I am determined that more indigenous SMEs can access the R and D tax credit, and changes have been made so that the threshold for first-year refunds will increase to €87,500 to support smaller projects. We have increased the capital gains tax, CGT, revised entrepreneur relief lifetime limit from €1 million to €1.5 million, at a rate of 10%. We have increased the employer PRSI threshold to ensure that employers do not pay the higher rate of PRSI for full-time workers earning the proposed increase to the national minimum wage. We have made amendments to the digital games tax credit to support the life cycle of video game development. We have extended the special assignee relief programme, SARP, for a further five years. There are changes to foreign dividends rules. We have extended the key employee engagement scheme to the end of December 2028.
These measures, when taken together, strongly signal Government’s commitment to the pro-enterprise vision espoused in the action plan on competitiveness and productivity which I launched with the Taoiseach and Tánaiste last month, as well as the action plan on market diversification. Both comprehensive plans signal the pathway forward for Irish SMEs as we navigate changed geopolitical trading environments.
The Government has endorsed the recommendation of the Low Pay Commission to increase the minimum wage to €14.15 per hour. In coming to its decision, the commission took a number of factors into consideration, including the potential impact of any increase on employment and competitiveness. The 4.8% increase in the minimum wage is not dissimilar to the overall expected increase in wages across the economy next year, and will benefit 200,000 workers across the State. The Low Pay Commission is made up of both employee and employer representatives and delivered this unanimous recommendation, which Government has accepted and will now implement.
I will now turn to the resources allocated to my Department under budget 2026, resources that will enable us to deliver on our strategic priorities for enterprise, innovation, and tourism. This year, we have secured a gross allocation of €1.298 billion, made up of €618 million in current funding and €680 million in capital funding. Under the national development plan, our capital envelope of €3.68 billion, augmented by agency-generated income, will allow us to invest nearly €5 billion over the next five years. This funding will support both existing programmes and new multi-annual investments aligned with the programme for competitiveness and our actions through government.
We are investing in next-generation foreign direct investment, FDI, sites, scaling indigenous businesses through a new scaling fund, with €120 million allocated to support Irish participation in European innovation projects like IPCEI, or important projects of common European interest.
We are also expanding technology centres, boosting European Space Agency contract opportunities, and driving innovation through the disruptive technologies innovation fund.
On the current side, the €618 million allocation will support the establishment of the national Al office, enhance tourism development and strengthen operational capacity across our agencies. It will also ensure we are ready to lead during Ireland's EU Presidency in 2026, including our role in shaping the European Competitiveness Fund. These investments are strategic, targeted, and essential to securing Ireland’s future competitiveness.
On the tourism side, we will receive €70 million in national development plan funding over the coming years, and later this month I will be launching our landmark new tourism strategy. The strategy will expand the remit of Fáilte Ireland, include plans around our new national culinary strategy, as well as laying out our ambitions and targets around business events and tourism. Ultimately, we will be introducing key performance indicators to ensure that our SMEs remain at the very heart of our tourism offering and that they can grasp the opportunities tourism presents for our local economies and our indigenous enterprises.
The expenditure and taxation measures announced in budget 2026 have been framed in light of the need to moderate the level of public expenditure increases while also targeting those areas where support is most needed. The taxation and expenditure announced in the budget will ensure that we can continue to grow our economy through increasing our competitiveness and productivity, delivering quality jobs and diversifying across international markets to mitigate against economic shocks. In today’s volatile global economy, we are keeping a laser focus on supporting Irish SMEs, regional development, innovation and tourism to ensure Ireland remains resilient and competitive, and so that quality job opportunities remain available to our citizens. The 2.82 million workers in our economy must be protected through every available means and budget 2026 has job protection objectives right at its core.

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Source: Houses of the Oireachtas. Licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). The Official Report is revised after first publication; the fetch timestamp below identifies the version quoted.

Record URI: https://data.oireachtas.ie/akn/ie/debateRecord/seanad/2025-10-14/debate/main
Retrieved: 2026-08-14T04:54:13+00:00
Sitting date: 2025-10-14