FSI calls for investment tax reform in Budget 2027 to support Ireland's competitiveness
- Pre-Budget Submission highlights importance of fostering a local culture of retail investment with a new retail investment account
- Removal of eight-year deemed-disposal rule and bringing exit tax on funds (38%) in line with capital gains tax (33%)
- Additional funding for Skillnet Ireland to support workforce transition
Financial Services Ireland (FSI), the Ibec group representing the financial services industry, has called for reform of Ireland's investment tax regime as part of a series of measures set out in its Pre-Budget Submission for Budget 2027.
The submission identifies taxation and expenditure measures that can strengthen Ireland’s position as a global financial centre. Next year marks the 40th anniversary of the launch of the IFSC and will feature the launch of a Personal Investment Account (PIA) for retail investors.
The PIA is expected to have a tax-free element but FSI points out that wider reform is needed across the investment space in Ireland.
With regards to taxation, the submission recommends the elimination of the eight-year deemed-disposal rule on investment funds, the alignment of the 38% exit tax on investment funds with the 33% capital gains tax rate, as well as the removal of the 1% government insurance levy.
FSI Director Patricia Callan said: "Budget 2027 is an important opportunity to strengthen Ireland's competitiveness and continue the work of making our investment system simpler and more attractive, which will ultimately benefit consumers. The introduction of PIAs will make it easier for households to invest but we need to ensure that this is complemented by other measures to incentivise investment. We believe the changes highlighted in our Pre-Budget Submission will help to remove barriers and support the much-needed development of a stronger investment culture in Ireland."
On expenditure, FSI recommends increasing funding for Skillnet Ireland to ensure we maintain a talent pool that is equipped for the age of AI, as well as continued funding for Ireland's Women in Finance Charter.
Patricia Callan concluded: "Ireland has significant strengths in financial services, but international competition continues to grow. Budget 2027 is an opportunity to build on those strengths, remove barriers to investment for households and ensure Ireland remains an attractive location for financial services firms."
