Dáil Éireann Debate, Thursday - 18 December 2025
186. Deputy Naoise Ó Cearúil asked the Tánaiste and Minister for Finance the proportion of corporation tax receipts currently being set aside in the State’s savings funds; the extent to which this has changed since 2024; and if he will make a statement on the matter. [69880/25]
Amharc ar fhreagraThe two funds – the Future Ireland Fund and Infrastructure, Climate and Nature Fund – were created in response to the exceptional levels of corporation tax revenue we have experienced over the last number of years as well as the fiscal costs associated with demographic change.
These funds have two primary purposes which help to ensure the long-term sustainability of the public finances: they ensure that a portion of ‘excess’ corporation tax receipts are saved, rather than used to fund day-to-day expenditure, and they partially fund the expenditure costs associated with known structural challenges that the Irish economy will face, such as ageing costs and decarbonisation.
Over the course of this year, some €6 billion has been transferred from the Exchequer into the Future Ireland Fund and Infrastructure, Climate and Nature Fund. Corporation tax is projected at about €32 billion for the year, excluding the once-off proceeds from the Court of Justice of the EU ruling. In effect, therefore, we are saving around one-fifth of corporation tax receipts.
This brings the total amount that has now been saved in the two funds to over €16 billion.
In 2024, around €4 billion was transferred into the FIF and €2 billion was transferred into the ICNF from the dissolution of the National Reserve Fund. A further €4 billion was also transferred from the Exchequer to the FIF in 2024.
Next year, Government will transfer €6.5 billion into the two funds. This represents a significant portion of the €34 billion corporation tax receipts that are projected to be received in 2026.
Legislation passed by this house does not permit for drawdown from the FIF to occur until 2041. This is to provide sufficient time for the capital of the fund to grow. From 2041, the interest from the FI Fund can be withdrawn each year, up to a maximum of 3% the Net Asset Value of the Fund, maintaining the Capital and allowing the Fund to continue to grow, and provision be made for the future.
There are two mechanism by which drawdown from the ICNF may occur. Firstly up to 25% of the fund can be used to support State expenditure in a year where the Irish Fiscal Advisory Council and Minister for Finance are satisfied that there is a significant deterioration in the economic or fiscal position of the State.
Secondly, between 2026 and 2030, up to 22.5% of the value of the fund may be drawn down annually, up to a total of €3.15 billion, in order to support expenditure on designated environmental projects.
While our finances are currently in a strong position, it is essential that we take action to secure the public finances over the long term to ensure we can meet the future expenditure requirements we know will arise, that is what this Government is doing in committing to these funds.
