Leo Varadkar (Dublin West, Fine Gael)
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373.To ask the Minister for Finance given his Department's over-estimate of the cost of tax reductions in recent years (details supplied), whether he has initiated any review or actions to better understand the cause of these over-estimates and if he can give any reassurance that the cost of the tax package for 2025 will not also be over-estimated or over-stated.[35583/24]

Jack Chambers (Dublin West, Fianna Fail)
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The costing of new tax policy measures is a challenging process which frequently, by necessity, involves relying on a number of assumptions. A key limiting factor in the costing process can be the availability of data on the likely take up and potential base. As a result, there is a large degree of uncertainty involved including in relation to behavioural effects. This is acknowledged by many, including the Parliamentary Budget Office in their assessment of the Uncertainty of Budget 2023 Costings, published in 2023.

The Department of Finance's Guidelines for Tax Expenditures sets out a framework and best practice guide to the evaluation and review of tax expenditures. Under the Guidelines tax expenditures are reviewed regularly, with reviews ongoing of the Employment Investment Incentive (EII) and of share-based remuneration (including the Key Employee Engagement Programme (KEEP)). However, full statistics from tax returns may not be available for a certain period after the introduction of a relief allowing for the tax return cycle.

My Department has been working on updating the Guidelines for Tax Evaluation. The updated Guidelines will set out best practice for both ex ante and ex post evaluations, and are due to be published in the coming weeks.