Dáil Éireann Debate, Tuesday - 25 November 2025
281. Deputy Barry Ward asked the Tánaiste and Minister for Finance his views on whether the existing level of capital gains tax acts as a disincentive to investment in the stock market; and if he will make a statement on the matter. [66055/25]
View answerCapital Gains Tax (CGT) is chargeable on a gain arising on the disposal of an asset, including a residential property, at the rate of 33%. The first €1,270 of chargeable gains of an individual in any year are exempt from CGT.
The existence of a 33% rate of CGT can help maintain a balance between the rate of taxation of capital assets and the higher rate of income tax. There are a number of targeted reliefs including principal private residence relief, retirement relief and revised entrepreneur relief. Exemptions often requires a higher rate in order to generate an appropriate yield.
The Programme for Government commits to maintaining a broad tax base to guard against the need for counter-cyclical fiscal policy in the event of a downturn and to prepare for future budgetary challenges relating to population aging. Capital Gains Tax (CGT) is part of a system to ensure taxation is not focused solely on income tax and that those who benefit from gains in the value of their assets are included within the tax net on an equitable basis.
While Ireland's headline rate of CGT appears high compared with our European counterparts, in order to carry out a fair comparison, account has to be taken of the specific details of various CGT systems in different jurisdictions. This includes examining special rates, and reliefs and exemptions, rather than focusing solely on the applicable headline CGT rates for the purposes of comparison.
While I do not think the existing level of CGT acts as a disincentive to investment in the stock market, CGT as with all taxes, is subject to ongoing review, which involves the consideration and assessment of the rate of CGT and the relevant reliefs and exemptions from CGT. CGT policy and legislation is reviewed as part of the annual Budget and Finance Bill process and as part of wider tax policy considerations.
