Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

This recommendation seeks a report on the introduction of a so-called wealth tax, to be provided within six months of the passing of this Bill into law. As the Senator should be and is well aware, wealth can be taxed in many ways, and some of these taxes are already levied here in Ireland. These include capital gains tax and capital acquisitions tax, which are in effect taxes on wealth in that they are paid by an individual or company on the disposal of an asset or the acquisition of an asset through gift or inheritance. There is also deposit interest retention tax, which is currently charged at 33%, with limited exemptions, on interest earned on deposit accounts. There is also the local property tax, which is based on the market value of residential properties. Another is stamp duty, which is charged on the transfer of shares, stocks and the marketable securities of Irish registered companies, as well as on the purchase of property, both residential and non-residential.

It follows that any revenue raised from a wealth tax, no matter what form it takes, may not therefore be additional to the existing forms of wealth taxation, as revenues from those taxes could be affected by the introduction of a wealth tax.

On the issue of household wealth, in September 2020 the Central Bank published a report entitled Household Wealth: what is it, who has it, and why it matters. It presents the results from the household finance and consumption survey, which in 2018 collected data on households' financial positions. I am informed that it indicates that household net wealth grew by over €76,000, or by 74%, up to 2018, driven primarily by house price growth and declining mortgage debt. The report, therefore, is clear that a significant portion of wealth for most households is tied up in the family home.

While the net wealth of the top 20% of households increased by approximately 52% to €853,000, the relative share of net wealth held by the top 10% of households decreased by 2.6% from 2013 and is 1.3% below the equivalent figure for the eurozone as a whole.

As was confirmed in my Department's recent document, Budget 2023: Beyond GDP – Quality of Life Assessment, published as part of the range of documents supporting budget 2023, a range of metrics demonstrate that, by comparison with other countries, the Irish tax and welfare systems contribute substantially to the redistribution of income and a reduction in income inequality.

My officials continue to examine all issues related to taxation, including the taxation of wealth; however, because we already have an array of taxes in place that in their own way tax different stores of wealth, and because these taxes are reviewed regularly through the Tax Strategy Group process, I do not propose to accept the Senator's recommendation but I thank her for raising these important matters.