Michael Cahill (Kerry, Fianna Fail)
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103. To ask the Minister for Finance if he will review the current interaction between capital gains tax and capital acquisitions tax in the case of lifetime gifts, where the same transaction can result in a significant combined tax burden for both the donor and the recipient, despite a credit mechanism; his views on whether this regime unintentionally discourages lifetime transfers in favour of inheritance, which is not subject to CGT; and if he will make a statement on the matter. [39410/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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Capital Gains Tax (CGT) is paid on the chargeable capital gain made when an individual disposes of an asset. The chargeable gain is usually the difference between the price paid for the asset and the price upon disposal. CGT is payable by the person making the disposal.

A charge to Capital Acquisitions Tax (CAT) may arise on a gift or inheritance of an asset. It is payable by the beneficiary of the asset.

Where the same event gives rise to a liability to CGT for the disponer and CAT for the beneficiary in respect of the same asset, section 104 of the Capital Acquisitions Tax Consolidation Act 2003 provides for a credit for any CGT paid by the disponer to be set against the CAT payable by the beneficiary, thus reducing the beneficiary’s CAT liability.

The credit for CGT paid cannot exceed the amount of the beneficiary’s CAT liability and the relief is confined to property that is doubly taxed. Any CAT relief availed of in this way will be withdrawn where the asset is disposed of within 2 years of the date of the gift or inheritance.

Deputy, you have asked for my views on whether this regime unintentionally discourages lifetime transfers in favour of inheritance, which is not subject to CGT. As Minister for Finance my job is to ensure that there is a fair and effective tax system in place. In this context, while acknowledging that death is not an occasion of charge to CGT, I believe that in the case of gifts the credit given against CAT is reasonable in the circumstances of this type of situation.

John Connolly (Galway West, Fianna Fail)
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106. To ask the Minister for Finance the Government Position on introducing legislation to allow local authorities introduce a commercial bed occupancy tax to raise revenues locally, as requested by a number of local authorities; and if he will make a statement on the matter. [39406/25]

Seán Ó Fearghaíl (Kildare South, Fianna Fail)
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107. To ask the Minister for Finance his response to the Central Bank's second Quarterly Bulletin of 2025; and if he will make a statement on the matter. [39244/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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I welcome the publication of the Central Bank's Quarterly Bulletin for Q2 2025, which forecasts continued growth in the domestic economy over the years ahead, albeit at a slower rate owing to the rise in global economic policy uncertainty.

The Bank has revised its forecasts downwards since the last bulletin and now expects Modified Domestic Demand (MDD) growth of 2.0 per cent this year and 2.1 per cent next year. With respect to the labour market, while there is an upward revision to the unemployment rate forecasts, the Central Bank are still projecting the rate to remain below 5 per cent over the forecast horizon – broadly consistent with full employment.

Although the figures contained in the Quarterly Bulletin illustrate the relatively healthy starting point for both the Irish economy and public finances, the downward revision to the Bank’s growth forecasts reflects the effects of the more uncertain external outlook. In particular, the Bank have highlighted that further geo-economic fragmentation is a substantial downside risk to the outlook and would further weaken growth.

Indeed, recent announcements by the US administration regarding a 30 per cent tariff on EU imports into the US from August 1^st demonstrate the potential for trade fragmentation to escalate further. That is why we must - together with our EU counterparts - now take the time we have available to redouble the intensity of our negotiations to find the best deal we can.

In the meantime, from a Government perspective, we will focus on controlling the ‘controllables’, in other words, we are focusing on what we can directly influence. This means continuing to improve resilience, competitiveness and productivity. We will do so by continuing to address major infrastructural bottlenecks in key strategic areas, as well as investing in skills and training. From a fiscal perspective, a key priority is to continue to build up our buffers so that we can respond effectively if, and when, the next economic shock occurs.