VAT Charity Compensation Scheme
The Government introduced a VAT Compensation Scheme for Charities in Budget 2018 to reduce the VAT burden on charities through a partial compensation for VAT paid.
Under the Scheme, Charities are entitled to claim a refund of a proportion of their VAT costs based on their level of non-public funding.
The total annual capped fund was €5 million initially, and was raised to €10 million in Budget 2024, for payment under the Scheme. Where the total amount of eligible claims from all Charities in a year exceeds the capped amount, claims are paid on a pro-rata basis. This is being increased to €15 million for 2027.
Residential Zoned Land Tax
A further opportunity will be provided for Residential Zoned Land Tax (RZLT) landowners to make a submission requesting a change in zoning of land appearing on the revised map for 2027, and, in certain circumstances, being exempted from RZLT for 2027 on foot of such submissions.
Derelict Property Tax
A new Derelict Property Tax (DPT), announced in the last Budget, will be introduced in the Finance (No. 2) Bill 2026. This new tax will be collected by the Revenue Commissioners and will replace the existing Derelict Sites Levy. Local Authorities will be responsible for identifying derelict properties and recording those properties on a register of derelict properties. The tax will apply to residential and non-residential properties, and the rate of the tax will be 7% of the self-assessed value of the property.
To avoid liability to DPT, owners will be required to take steps to ensure that their property is no longer considered derelict. This can be achieved through remediation, the demolition and clearing of any derelict structure or building, or through the sale of the property to an owner who will subsequently address the dereliction. A limited amount of deferral criteria will apply, such that property owners who remediate properties within a reasonable time frame may seek abatement of the tax.
Excise
Tobacco – excise duty on tobacco products is being increased by 1 euro, inclusive of VAT, on a pack of 20 cigarettes in the most popular price category, together with pro rata increases for other tobacco products.
E-liquid products tax – excise duty on all e-liquid products is being increased by 20 cents per millilitre, exclusive of VAT with effect from 1 January 2027. The increase will bring the total excise on e-liquid products to 70 cents per millilitre, VAT exclusive.
Pool Betting Charge – a new betting charge for totalisator or pool betting is being introduced, generally commencing on the 1 January 2027. The rate of excise duty will be 25% on commissions earned. There will be an exemption for on course pool bets.
VRT
The €5,000 VRT relief for electric vehicles will be extended for another two years to 31 December 2028.
VRT rates on more pollutant cars in bands 3 to 20 will be increased by 1%.
eWithholding Tax (eWHT)
Professional Services Withholding Tax is being modernised via the introduction of Personalised Deduction Rates (PDRs) to replace the current flat rate of 20% of the gross payment. In addition, legislative changes will be made to allow self-employed taxpayers to opt-in for the realtime exchange of information with Revenue, to ease their administrative burden.
Carbon Tax
Carbon taxes on auto fuels currently due to increase on 14 October 2026 to €78.50 per tonne of CO2 emitted will be deferred to 1 May 2027. A further increase will take place on 13 October 2027 whereby these fuels will be back on the trajectory to €100 per tonne of CO2 as set out in Finance Act 2020.
Carbon taxes on kerosene and on natural gas will be reduced to €48.50 t/CO2 emitted until 2030.
Pool betting duty
Pool betting duty will be legislated in Budget 2027 for a separate pool betting duty charge.
Bank levy
The bank levy will be extended until 2027.
Donations of Heritage Items
The aggregate value limit on all donations of heritage items in any single year is being increased from €8 million to €12 million. Donations under the scheme, which is operated by the Minister for Culture, Communications and Sport, give rise to tax relief to the donor of 80% of the value of the donation.