I propose to take Questions Nos. 93, 94, 95, 96, 97, 98, 100 and 103 together.
The Deputy asks about the interaction between deemed disposal and investment decisions, including in relation to the types of assets invested in, and the Government’s commitment to encouraging retail investment.
Due to the mechanics of the eight-year deemed disposal, (across both life and fund investment provisions), and the data which is returned to Revenue, it is not possible to garner the exact tax yield of the eight year deemed disposal provisions. In addition, as with all anti-avoidance rules, its existence has a deterrent effect which it is not possible to put a value on.
Individual assessments on the relationship between deemed disposal and other forms of investment have not been undertaken. Data on the volume of retail investment that may have been diverted away from EU-domiciled ETFs and into non-EU domiciled funds, direct equity shareholdings, or other asset classes specifically to avoid the deemed disposal regime is not available.
The importance of ensuring that retail investment is encouraged is recognised by this government, including through commitments in the Programme for Government.
Ireland is currently ranked as one of the top EU Member States in terms of savings held in deposit accounts. I am aware that part of the reason why retail participation in markets is limited is the lack of awareness of these products, and in some cases the complexity of some of the products can also dissuade retail consumers.
It is a priority of the government to promote financial literacy and widen retail investment across the country. This will assist in ensuring savings could be invested for the benefit of individuals as well as the European economy. Financial literacy is an essential life skill and important component of financial consumer protection. In February 2025 this government launched Ireland’s first National Financial Literacy Strategy. In this regard, the European Commission’s financial literacy strategy is welcome. The strategy aims to empower citizens, raise awareness and increase their participation in capital markets, creating a more “investment savvy” culture.
In line with the commitment in Budget 2026, work is underway on an approach to the taxation of retail investment. This work includes consideration of the current taxation regime for ETFs and other investment funds, as well as the European Commission’s Recommendation on the availability of Saving and Investment Accounts, drawing upon best practice in other countries who operate successful savings accounts. This is expected to be published in the coming months.
