Mairead Farrell (Galway West, Sinn Fein) | Oireachtas source

The Minister of State just said that the funds pay tax as well but they do not. They pay no corporation tax or capital gains tax. I have a quote from the Minister of State from an RTÉ Radio 1 interview he did earlier this year. He said that on any profits being made there is a tax of 20% or 25% depending on the structure and that any profits they make are taxed at a higher rate: "double the rate of corporation tax" as the Minister of State put it. We have looked at the figures and the Minister of State’s statement simply was not true. The figure of 17.9% the Minister of State was citing was relative to the taxable event, meaning distributions to shareholders; it was not relative to rental profits. In 2019 tax paid by IREFs relative to pre-tax profit was 9.1%, which was less than the 25% paid by any other landlord and less than the 12.5% paid by any other company. Furthermore we know these funds pay no capital gains tax or corporation tax whatsoever. The Government’s defence of these funds snapping up homes at the expense of renters and struggling home buyers is that they stimulate supply. However, the financial stability review published by the Central Bank last month found that the majority of residential units purchased by investment funds were existing and not new stock. That point was made on page 70 of that review.

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