Dáil Éireann Debate, Thursday - 25 June 2026
59. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Finance if he is considering a tax on data centres to broaden the tax base and to raise funding for critical energy infrastructure projects; and if he will make a statement on the matter. [48318/26]
Amharc ar fhreagraAs the Deputy may be aware, the Programme for Government emphasises the importance of maintaining a broad tax base. This is necessary to both guard against the need for counter-cyclical fiscal policy in the event of a downturn as well as to prepare for future budgetary challenges relating to an ageing population.
Actions have been taken to broaden the tax base, for example through introduction of the Local Property Tax, and to broaden the cohort of taxpayers through measures to support the establishment and growth of new businesses in our economy.
As a small open economy, connected to Europe, the United States, and the wider world, Ireland is committed to a competitive, transparent and stable corporation tax system.
Businesses trading as data centres are subject to the general rules of taxation in respect of their trading activities. There are no specific tax reliefs aimed solely at persons engaged in the data centre sector. Imposing additional taxes on certain sectors would involve increased complexity and could change the attractiveness of Ireland’s corporate tax regime.
Data centres are important for Ireland’s economic and digital future and are key enablers of foreign direct investment. Data centres also bring wider economic benefits – through tax revenues and employment in connected businesses, their contribution to broader digital infrastructure value, and significant linkages to other high-value sectors of the economy.
A March 2026 KPMG study on data centres, undertaken on behalf of the Department of Enterprise Tourism and Employment, reported that the construction and operation of data centres underpinned almost 19,500 jobs in 2024. It also states that, across the six sectors in Ireland with the highest data centre dependency, around 876,000 jobs were enabled by the availability of digital infrastructure provided by data centres located in Ireland.
Notwithstanding these points, I am aware of the challenges arising from the rise in data centres, particularly in the area of energy. The Government is committed to delivering a balanced approach to facilitate sustainable data centre demand while also ensuring overall energy security and affordability for consumers and businesses. This must be addressed in a strategic manner, and we have prioritised and operationalised a number of policy, regulatory and investment workstreams to address these challenges in this way, including the Government’s Data Centre Policy Statement and the recently introduced Large Energy User Action Plan.
This policy and regulatory framework is being reinforced by an unprecedented investment in Ireland’s electricity network infrastructure, supported by a €3.5bn equity investment by Government in the electricity system operators.
