Budget 2027 will be announced on Tuesday, 6 October 2026, with Irish businesses watching closely for measures on labour costs, taxation, energy and investment.

The Government has set out an €8.5 billion Budget package, comprising €7 billion in additional spending and €1.5 billion in new tax measures. Against that backdrop, business groups and professional bodies have been setting out their priorities for the months ahead.

From the proposed minimum wage increase to calls for Capital Gains Tax reform, these are some of the key Budget 2027 pressure points for Irish businesses and the measures to watch on Budget Day.

1. Energy costs and business supports

Energy costs have become one of the main issues in the run-up to Budget 2027.

Government figures have indicated that energy and fuel costs will form part of the Budget discussion, with measures to reduce the impact of higher home heating and fuel costs under consideration.

While much of the public discussion has focused on households, business groups continue to highlight the wider impact of energy costs on the cost of doing business, particularly for energy-intensive sectors and smaller firms with limited ability to absorb further increases.

Businesses will therefore be watching closely for any measures aimed specifically at reducing or offsetting energy-related costs.

2. National Minimum Wage 2027 and labour costs

The Low Pay Commission has recommended increasing the national minimum wage by 79 cent, from €14.15 to €14.94 per hour, from January 2027.

Small business representatives have urged Government to reconsider the proposed increase, pointing to the cumulative impact of higher wage, employment and operating costs in recent years.

The Government’s decision on the recommendation is expected as part of the Budget process, making this one of the most closely watched issues for employers.

For businesses with significant numbers of lower-paid employees, any increase will need to be factored into wage budgets for 2027.

3. Income tax bands and payroll

The €44,000 standard rate cut-off point for a single person, where the 40% income tax rate begins, was left unchanged in Budget 2026.

Ahead of Budget 2027, there has been considerable discussion around increasing the point at which workers enter the higher tax rate. Minister for Finance Simon Harris has indicated that personal income tax will be a significant focus of the €1.5 billion tax package.

The final scale of any changes to tax bands, credits or USC will not be known until Budget Day.

For employers, changes to income tax bands and credits can also have a wider impact on payroll administration, take-home pay and wage expectations.

4. Capital Gains Tax, CAT and business succession

Ireland’s headline Capital Gains Tax rate currently stands at 33%.

Professional and business organisations have continued to call for reform, arguing that the rate can discourage investment, entrepreneurship and business succession.

There has also been political discussion around the level of the CGT rate, although no reduction has been confirmed for Budget 2027 and current indications suggest that personal income tax measures will be a major focus of the available tax package.

Entrepreneur Relief currently allows qualifying individuals to benefit from a reduced 10% CGT rate on eligible gains, subject to a lifetime limit of €1.5 million. The limit increased from €1 million for qualifying disposals made from 1 January 2026. Some professional bodies are calling for further changes to the relief as part of wider CGT reform.

There are also calls for further increases to Capital Acquisitions Tax thresholds.

The Group A threshold, which broadly applies to gifts and inheritances from parents to children, currently stands at €400,000. The Group B threshold, which can apply to siblings, nieces and nephews, is €40,000.

Professional and industry submissions have argued that thresholds should better reflect changes in asset values, although no further increases have yet been confirmed.

For family-owned businesses considering a future transfer or succession, any changes to CGT or CAT could therefore be significant.

5. R&D Tax Credit and workforce skills

Ireland’s Research and Development Tax Credit increased from 30% to 35% in Budget 2026.

The Government also indicated at the time that further work would examine areas such as outsourced R&D expenditure and the definitions of qualifying expenditure.

Ahead of Budget 2027, business groups and professional bodies are continuing to call for further improvements to the regime, including greater accessibility for SMEs and measures designed to encourage innovation and investment.

There are also growing calls for greater use of the National Training Fund surplus to support workforce development.

Business organisations have highlighted areas including AI, digital skills and broader upskilling as priorities, particularly as businesses adapt to changing technology and skills requirements.

6. Support for Irish-owned businesses

A wider concern running through many of the pre-Budget submissions is Ireland’s reliance on corporation tax receipts from a relatively small number of multinational companies.

ISME has highlighted the concentration of corporation tax receipts among a relatively small number of companies and has used this as part of its case for stronger support for the domestic business sector.

That concern has contributed to calls for greater support for Irish-owned businesses, particularly SMEs and indigenous companies.

Measures being sought across various submissions include relief from rising employment costs, tax incentives for investment and entrepreneurship, improved access to finance and greater support for productivity and skills.

The extent to which these measures feature in Budget 2027 will become clearer on 6 October.

What should businesses do before 6 October?

Nothing is confirmed until Budget Day, but businesses can still prepare for potential changes.

• Check that payroll systems can be updated quickly for changes to tax bands, credits or the minimum wage
• Model the potential impact of the proposed minimum wage increase on 2027 payroll costs
• Review energy contracts and energy cost forecasts for the year ahead
• If you are considering a business sale, transfer or succession, seek advice before making decisions based on possible tax changes
• Review planned R&D, training and investment expenditure in case new incentives or supports are introduced

Budget 2027 will involve choices between household supports, public spending and measures aimed at maintaining business competitiveness.

For businesses, the detail announced on 6 October will matter most.

If you would like to discuss what Budget 2027 could mean for your business, contact the ECOVIS Ireland tax team

📞 +353 1 8230000
📧 info@ecovis.ie
🌐 www.ecovisireland.com