Dáil Éireann Debate, Thursday - 18 December 2025
188. Deputy Michael Cahill asked the Tánaiste and Minister for Finance if he is aware that financial advisers, tax consultants, accountants, and legal professionals widely regard the taxation regime for exchange-traded funds as unnecessarily complex and opaque; if he will consider addressing this issue, including through the possible deletion of Chapter 2, Part 27 of the Tax Acts; and if he will make a statement on the matter. [69525/25]
View answer213. Deputy Grace Boland asked the Tánaiste and Minister for Finance if his Department has considered reforms to the taxation and regulatory framework to encourage individuals to invest and save through exchange-traded funds (ETFs); if measures such as simplified reporting, reduced or eliminated exit tax, or inclusion of ETFs in State-backed savings schemes are under review; and if he will make a statement on the matter. [69882/25]
View answer245. Deputy Sean Fleming asked the Tánaiste and Minister for Finance for an update on tax measures to incentivise retail investing in Ireland, particularly in relation to ETFs; and if he will make a statement on the matter. [72576/25]
View answerI propose to take Questions Nos. 188, 213 and 245 together.
The Deputy has asked about the taxation regime for Exchange Traded Funds (ETFs). An ETF is a collective investment fund that is traded on a regulated stock exchange. There is no separate taxation regime specifically for ETFs. The domicile of the ETF will generally determine whether the ETF falls within the domestic gross roll-up regime or the offshore funds regime.
In general, for exit taxes applying to investment funds, the investment fund calculates and deducts any exit tax due, including for deemed disposal. However, where units in an investment fund are traded and cleared on a recognised clearing system, investors are required to calculate, return and pay the income tax on the income and gains arising from their investment in the fund on a self-assessed basis, as the fund does not have the information necessary to apply an exit tax. Investors in offshore funds also have to account for tax due through Revenue’s self-assessment system. Therefore, self-assessment applies to most ETF investments.
I am aware that the current system for the taxation of investments is complex and that the requirement for self-assessment for ETFs can contribute to this. I am committed to taking the necessary action to support retail investment in Ireland and recognise the importance of this sector. The reduction in the taxation rate that applies to Irish and equivalent offshore funds, and Irish and certain foreign life assurance products, from 41% to 38% announced in Budget 2026 is an important first step in this regard. This reduction applies to ETFs that fall within these taxation regimes.
However, I am conscious of the need for continued engagement on this issue. Budget 2026 also included a commitment to publish a roadmap for the taxation of retail investment. The roadmap is to be published early next year and will set out an approach to simplify and adapt the tax framework to further support retail investment while retaining necessary and important anti-avoidance protections in a proportionate manner, and existing legislation is being considered as part of the process of developing the roadmap.
This roadmap will facilitate due consideration of the Funds Sector 2030 Report and take into account the European Commission’s recommendation on Savings and Investment Accounts. I hope further progress can be made across coming budgets to address some of the existing obstacles to greater retail investment.
