On 12 October 2021, Ireland's Minister for Finance, Paschal Donohoe, delivered the Budget 2022. The main tax measures of the budget are summarized as follows:

• The income tax standard rate band for all earners will be increased by EUR 1,500, from EUR 35,300 to EUR 36,800 for single individuals and from EUR 44,300 to EUR 45,800 for married couples / civil partners with one earner;
• The Employment Wage Subsidy Scheme will be extended until 30 April 2022, in a graduated form;
• A new tax credit will be introduced for the digital gaming sector at a rate of 32%, on eligible expenditure of up to a maximum limit of EUR 25 million per project;
• The relief for certain start-up companies will be extended for a period of five years, with the relief also amended such that companies may avail of the relief within their first five years of trading, an increase from the current three years;
• The Employment Investment Incentive scheme will be extended and expanded to the end of 2024;
• The rate of carbon tax will increase by EUR 7.50 from EUR 33.50 to EUR 41.00 per tonne of carbon dioxide emitted, which applies from budget night for auto fuels and from 1 May 2022 for all other fuels;
• The Accelerated Capital Allowance scheme for Energy Efficient Equipment, which allows an accelerated deduction when businesses invest in highly energy efficient equipment, is being amended to prohibit equipment directly operated by fossil fuels from qualifying for the scheme;
• The Accelerated Capital Allowance scheme for Gas Vehicles and Refuelling Equipment, which allows an accelerated deduction when businesses invest in vehicles powered by natural gas / biogas and related refuelling equipment, is being extended to the end of 2024 and is being amended to include hydrogen powered vehicles and refuelling equipment;
• A new Interest Limitation Rule in line with Article 4 of the Anti-Tax Avoidance Directive (ATAD) will be introduced, which will place a limit on deductible interest expenses of 30% of EBITDA for companies within scope of the measure, with disallowed interest allowed to be carried forward and deducted in future years if a company has sufficient interest capacity; and
• New anti-reverse-hybrid rules in line with Article 9(a) ATAD will be introduced, which will bring certain tax transparent entities (such as partnerships) within scope of Irish tax where the entity is 50% or more owned/controlled by entities resident in a jurisdiction that regard it as tax opaque and, as a result of this hybridity, double nontaxation occurs.

In addition to the above, Minister Donohoe also confirmed in his budget speech that the reduced VAT rate of 9% for the hospitality sector will remain in place until the end of August 2022 as previously announced.

Further to the measures for the Budget 2022, Minister Donohoe also addressed the recent agreement on the OECD's two-pillar solution for global tax reform, which Ireland has joined. With respect to the agreement, the Minister noted that when the agreement comes into effect, Ireland will apply the new minimum effective rate of 15% but, importantly, will continue to offer the 12.5% rate for businesses with revenues less than EUR 750 million.