John Clendennen (Offaly, Fine Gael)
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30. To ask the Minister for Finance his views on the impact of proposed tariffs on economic growth in 2025; and if he will make a statement on the matter. [27626/25]

Joe Neville (Kildare North, Fine Gael)
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77. To ask the Minister for Finance how he envisages economic growth will be impacted next year and for the foreseeable future on account of potential tariffs; and if he will make a statement on the matter. [28257/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 30 and 77 together.

I want to reiterate the Government’s view that the imposition of tariffs is deeply regrettable.

While a pause on the implementation of reciprocal tariffs is welcome, there remains significant uncertainty surrounding future trade policy and tariffs remain at historically high levels. Government has been in continued discussion at EU-level and with our US counterparts to put forward an alternative and pragmatic path that will benefit all.

It is important to understand the potential impact of these policies in order to respond effectively. To this end, and working with the Economic and Social Research Institute, my Department has assessed the possible macroeconomic impact of various tariff scenarios. This was incorporated into my Department’s spring forecasts, which were published earlier this month in the Governments Annual Progress Report.

In the baseline - no transatlantic tariff scenario - Modified Domestic Demand (MDD) is projected to increase by 2.5 per cent this year and 2.8 per cent next year. These are downward revisions from the previous set of forecasts, published in the autumn, and reflect heightened uncertainty at present which is weighing on consumer and business spending.

In an alternative scenario - one in which tariffs remain in place at end-April levels - the level of MDD at end-2026 would be 1½ percentage points lower than in the 'no-tariff' scenario. 25,000 fewer jobs would be created in these circumstances.

These results should be taken as indicative. There is little or no precedent from which to make confident projections regarding the impact of trade de-coupling, and the confidence intervals around these estimates are particularly large.

It is also important to stress that there remains uncertainty regarding the scale, scope, and duration of tariffs, as well as the extent of any possible retaliation, making medium-term projections very challenging at this point.