The VAT cut that was and the one that wasn’t - Mayo Budget 2026 talking points

Mayo ministers have announce social welfare increases and permanent VAT reduction for hospitality, but opposition say it "quite shocking how the Budget has abandoned workers and families."

The reduction in the VAT rate for food and catering businesses and hairdressing was well flagged ahead of today’s announcement. The reduction from 13.5 percent to 9 percent will come into place at the beginning of July next year. 

READ MORE: What do Mayo businesses want to see announced today in Budget 2026?

Mayo Minister of State, Alan Dillion, stated that "this VAT reduction is a strong statement of confidence in our small and medium enterprises, which form the backbone of our economy. The sector employs 191,000 people nationally, with 75% of businesses employing fewer than 10 staff. In Mayo alone, 765 people work across the industry."

The Minister emphasised that the permanent nature of the cut provides long-term certainty for businesses to reinvest, innovate, and expand.

Minister for Social Protection, Dara Calleary TD, announced a Social Protection Budget package worth over €1.15 billion in ongoing measures for 2026.

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The Ballina TD said: “I believe that the measures I am announcing today will make a huge difference to the lives of the people we serve and, through them to the communities, in which we all live.”

One of the most notable announcements was the increase of the Carer's Allowance weekly income disregard by 60 percent. Single carers can now earn up to €1,000 per week while still receiving their full carer's payment, meaning they can work part-time and earn just over €54,000 annually without losing benefits.

For couples, the threshold rises even more dramatically to €2,000 per week, allowing carers in households where their partner earns up to €108,000 annually to qualify for the full payment.

"These are the largest ever increases in the Carer's income disregard," Minister Calleary stated, adding that the measures demonstrate the government's commitment to eliminating the means test over the lifetime of the current administration.

Calleary added that he was “particularly pleased to have secured over €320 million in targeted measures to alleviate Child Poverty, including the largest ever increase in the Child Support Payments of €8 (or 16 percent) and €16 (or 26 percent) per week for children aged under 12 and 12 and over respectively. These increases will benefit about 330,000 children whose parents are in receipt of a social welfare payment.”

Mayo TD Keira Keogh has welcomed the introduction of the new Derelict Property Tax, which will replace the current derelict sites levy. The new measure aims to incentivise property owners to bring unused properties back into productive use or put them on the market.

“This is a positive step forward. People will take Revenue seriously, and this will encourage real action on dereliction, allowing us to bring vibrancy back into our towns again,” Deputy Keogh said.

The tax is due to take effect in 2027.

Deputy Keogh urged property owners to use the time between now and 2027 to act:

“There are supports available to help bring vacant properties back into use, such as the Repair and Lease scheme and the Vacant Property Refurbishment Grant. Owners should engage early and make use of these opportunities rather than waiting for the tax to apply.”

According to Mayo’s register, 287 vacant and derelict units are currently listed in the county. Deputy Keogh also highlighted that local authorities should look to draw on the Urban Regeneration and Development Fund (URDF), which has an increased national budget of €300 million this year.

She encouraged anyone aware of a vacant home to log it on the government’s Vacant Homes portal to help identify properties suitable for regeneration.

Opposition Criticism

Sinn Féin TD Rose Conway Walsh told The Mayo News, it was quite shicking how this government Budget has abandoned workers and families to look after those at the top."

"It's one of the biggest tax packages ever, and there's no tax cut for ordinary workers, but there is for institutional landlords and developers."

"They have ignored the cost of living crisis and people have been left high and dry."

"It's reckless of this government to ignore that so many families are really struggling right now."

"It's remarkable how they have left people with disabilities almost €1400 worse off than they were last year. It's inexplicable."

Aontú TD Paul Lawless criticised the budget for failing to address construction costs for ordinary families.

Deputy Lawless today accused the Fine Gael and Fianna Fáil Government of a deliberate extraction of wealth from ordinary Irish workers. Despite pre-election promises the government has failed to deliver for working families in the 2026 budget. This proves that the Tanaiste’s promise to “make work pay” has been inverted, forcing workers to pay for a decade of government mismanagement and waste.

“A huge gulf has emerged from government rhetoric to what was delivered in today's budget. Simon Harris promised to 'make work pay,' but the 2026 budget ensures workers will pay. The standard rate cut-off point, where a single worker's income jumps from the 20% to the 40% tax rate, remains shamefully low at €44,000,” stated Deputy Lawless.

“A generation ago, this income could secure a home. Today, that low threshold actively prevents young workers and families from saving a deposit or meeting mortgage eligibility tests. The math is brutal: €44,000 puts a single worker into the 40% tax rate. That is not 'making work pay'—that is making workers’ pay for years of government mismanagement.”

The Government's failure to deliver meaningful tax relief is thrown into stark relief by its systemic inability to manage public funds, oversight, and procurement across the State.

He pledged to continue campaigning for the deletion of VAT on construction for ordinary families, highlighting what he sees as an imbalance in the government's approach to tax relief