Pearse Doherty (Donegal, Sinn Fein)
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83. To ask the Minister for Finance the estimated cost of removing the USC on all income up to €30,000, €35,000, €40,000 and €45,000, respectively, in tabular form. [31076/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised by Revenue that the table below sets out the estimated first and full year costs to the Exchequer, in 2025, of each proposal outlined by the Deputy.

Pearse Doherty (Donegal, Sinn Fein)
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84. To ask the Minister for Finance the first-year cost of reversing the May carbon tax increase from 1 November and not proceeding with the October carbon tax increase. [31077/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised that following clarification from the Deputy's office this question is to ask the 2025 cost of reversing the 1 May 2025 carbon tax increase and not proceeding with the 8 October 2025 carbon tax increase.

I am advised by Revenue that the estimated VAT inclusive first-year, 2025, cost of reversing the 1 May carbon tax increase from 1 November and not proceeding with the October carbon tax increase is €18 million. This represents the estimated 2025 receipts that would be forgone by the Deputy’s proposal. I am further advised by Revenue that the estimated full-year VAT inclusive cost of not proceeding with a €7.50 per tonne increase in the Carbon Tax across auto fuels and other fuels is estimated at approximately €157m.

The Deputy should note that these estimates are straight line estimates based on volumes recorded to date and do not account for behavioural change associated with climate action policies. As the Deputy will be aware in September 2024 my department published a paper titled “Carbon Tax Projected Exchequer Revenue Estimates 2024-2030”. This paper examines how domestic climate change policies are expected to impact carbon tax yields, as our economy transitions to a low carbon economy in line with climate action plan 2024 (CAP 24) measures. This scenario analysis maps and links forward projected estimates of energy use and expected fuel requirements from the Sustainable Energy Authority of Ireland (SEAI) to carbon tax rates and exchequer net carbon tax receipts to examine the potential impact of the implementation of CAP24 actions between 2024 and 2030 based on the SEAI and the Environmental Protection Agency (EPA) ‘With Additional Measure’ (WAM) scenario and ‘With Existing Measure’ (WEM) scenario analysis. This paper is available on my Department's website: www.gov.ie/en/publication/8e2d0-carbon-tax-projected-exchequer-revenue-estimates-2024-2030/

The Department is currently working on updated analysis which will be published in the coming months.

Pearse Doherty (Donegal, Sinn Fein)
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85. To ask the Minister for Finance the estimated cost of extending the lower VAT rate on electricity and gas until the end of 2025. [31078/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy will be aware the temporary reduction in the rate of VAT from 13.5% to 9% for gas and electricity was first introduced on 1 May 2022. In recognition of the ongoing difficulties experienced by households and businesses with the increasing cost of energy, it has continued to be extended since then with the latest extension passed by Financial Resolution on April 2 and due to expire on 31 October of this year.

While it is not possible to provide exact costings for an extension to 31 December 2025 , I am advised that the estimate for this measure is approximately €38m.

Pearse Doherty (Donegal, Sinn Fein)
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86. To ask the Minister for Finance the estimated cost of removing stamp duty for first-time buyers. [31079/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised by Revenue that, based on stamp duty returns for 2024, the latest year for which fully analysed data are available, the estimated cost of abolishing stamp duty for first-time buyers is in the order of €60 million.

This estimate is arrived at by taking the stamp duty returns for residential property purchases made by persons identifying themselves as first-time buyers, and taking the associated stamp duty liability as the potential cost of exempting them from the duty.

Pearse Doherty (Donegal, Sinn Fein)
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87. To ask the Minister for Finance the estimated cost to the Exchequer of abolishing the local property tax under the proposed changes. [31080/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I understand that the Deputy is referring to the proposed changes to Local Property Tax (LPT) approved by Government on 1 April. Further detail on these changes is available at: www.gov.ie/en/department-of-finance/press-releases/minister-donohoe-announces-changes-to-local-property-tax-to-ensure-fairness/

LPT yield accrues to the Local Government Fund rather than the Exchequer. The proposed changes to LPT are projected to raise a yield of €609 million before the application of the Local Adjustment Factor. This represents an 8% increase from the projected yield under the current structure. Abolishing the LPT under the proposed changes would lead to a corresponding shortfall in funding for local authorities.

It must be noted that this projected yield is indicative and does not take account of behavioural change. The final yield will be determined by self-assessed property values. Furthermore, the projected yield does not take into consideration the addition of future housing stock.

Edward Timmins (Wicklow, Fine Gael)
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88. To ask the Minister for Finance if he intends to review the current tax regime applied to Exchange-Traded Funds (ETFs) held by Irish-resident investors, particularly the 41% exit tax rate under the gross roll-up regime and the operation of the eight-year deemed disposal rule (details supplied); if reforms are being considered to bring the tax treatment of ETFs more in line with other forms of investment in order to support retail investors and promote a fairer and more coherent investment environment; and if he will make a statement on the matter. [31099/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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An “Exchange Traded Fund” or “ETF” is an investment fund that is traded on a regulated stock exchange. A typical ETF can be compared to a tracker fund in that it will seek to replicate a particular index. There is no separate taxation regime specifically for ETFs. ETFs, being collective investment funds, generally come within the regimes set out in the Taxes Consolidation Act 1997 for such funds.

Under the domestic fund regime, a ‘gross roll-up’ applies such that there is no annual tax on income or gains arising to a fund, but the fund has responsibility to deduct an exit tax in respect of payments made to certain unit holders in that fund. To prevent indefinite or long-term deferral of this exit tax, a disposal is deemed to occur every 8 years. For ETFs while the fund is not required to apply an exit tax, the Irish resident unit holder will be subject to tax on income and gains arising and must self-assess and include details of income and gains in a timely filing on their income tax return to Revenue.

The issues that the Deputy has raised in relation the taxation of investments were considered under the Funds Review recently conducted by my Department. In October 2024, my predecessor published the ‘Funds Sector 2030: A Framework for Open, Resilient & Developing Markets’, a wide-ranging review of the funds and asset management sector. This report sets out a series of recommendations to ensure that, in pursuit of continued growth in the funds and asset management sector, Ireland’s funds sector framework remains resilient, future-proofed, supportive of financial stability and a continued example of international best-practice.

The Funds Review Report included eight recommendations to promote increased retail participation in capital markets. Recommendations 22 and 23 of the Fund Review Report include consideration of the removal of the eight-year deemed disposal requirement for Irish domiciled funds and life products and alignment of tax rates across different investment choices.

I have heard the feedback on the need for modernisation of the existing taxation regime for funds and I recognise the complexities with the current regime for the average retail investor. The 2025 Programme for Government has committed to progress and publish an implementation plan for consideration in Budget 2026 taking into consideration the Funds Review recommendations to unlock retail investment and opportunities to grow this sector in Ireland.

This is a complex area of taxation that encompasses a wide breadth of tax legislation on domestic funds, life assurance products and offshore funds. Detailed consideration is therefore being given to the best way to bring about the necessary reforms and to support a greater level of retail investment in capital markets. It is likely given the breadth of the Funds Sector 2030 review that the delivery of associated tax measures may take place over multiple Finance Bill cycles. This work will also take account of developments at an EU level in respect of the Savings Investment Union.