Taoiseach Micheál Martin’s pre-election pledge to double the Renters’ Tax Credit to €2,000 would cost the Exchequer €160 million annually, according to Department of Finance advisory documents.
The Tax Strategy Group papers reveal varying costs depending on the scale of increases to the current €1,000 per person credit. A modest €100 increase for single people would cost €20 million yearly, while a €500 boost would require €95 million in additional spending.
Martin committed to doubling the credit “at a minimum” during the election campaign, arguing renters need financial pressure relief. Fine Gael proposed a smaller increase to €1,500 per person, while the Programme for Government includes a commitment to “progressively increase” the credit without specifying amounts.
The analysis shows the credit primarily benefits younger renters, with the largest claimant group aged 21-30, followed by those aged 31-40. This reflects both higher rental rates among younger demographics and their concentration in the private rental market.
More than half of claimants earn less than €40,000 annually, while only 7% have gross incomes exceeding €100,000. Lower-income claimants often cannot fully utilize the credit due to insufficient tax liability, with younger cohorts showing the greatest gap between claimed and used amounts.
The findings highlight the credit’s role as targeted support for financially stretched renters, particularly younger adults facing high housing costs relative to their incomes in Ireland’s expensive rental market.