Darren O'Rourke (Meath East, Sinn Fein)
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144. To ask the Minister for Finance if he intends to reform deemed disposal tax rules for Irish Investors. [67872/26]

Aisling Dempsey (Meath West, Fianna Fail)
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168. To ask the Minister for Finance if he has plans to remove the eight-year deemed disposal rule on investments. [68280/26]

Erin McGreehan (Louth, Fianna Fail)
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169. To ask the Minister for Finance his plans to bring forward changes to the current provisions for deemed disposal as part of Budget 2027. [68264/26]

Joe Neville (Kildare North, Fine Gael)
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171. To ask the Minister for Finance if his Department has plans to introduce reforms surrounding deemed disposals in the upcoming Budget. [68576/26]

Simon Harris (Wicklow, Fine Gael)
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I propose to take Questions Nos. 144, 168, 169 and 171 together.

The final report of the Funds Review, Funds Sector 2030: A Framework for Open, Resilient and Developing Markets Final Report, made recommendations regarding the taxation of investments, including in terms of the deemed disposal rule. It also noted that any changes to the deemed disposal rule require guardrails to protect the Exchequer and ensure that appropriate tax is paid.

As outlined in the recently published Roadmap for Taxation of Retail Investment, measures of this nature are considered as part of the annual budgetary process. Any decision has to consider the Budget ceilings agreed by Government, and the range of options across the entire tax system.

A key aspect of the Roadmap was the confirmation of the key parameters of the proposed new investment account, designed to facilitate increased retail investments. I can confirm that the deemed disposal rule and other relevant investment taxes will not apply to the investment account. Instead, there will be a tax-free threshold, and a low rate of tax applicable to value of the account over the tax-free threshold. Providers will be responsible for operating the tax for investors.

Edward Timmins (Wicklow, Fine Gael)
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145. To ask the Minister for Finance if he will reintroduce indexation for Capital Gains Tax as the current system leads to an unfair tax when there is no real gain. [68630/26]

Simon Harris (Wicklow, Fine Gael)
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Ireland's Capital Gains Tax (CGT) rate is 33%. It is paid on the chargeable capital gain made when a person disposes of an asset. The chargeable gain is usually the difference between the price paid for the asset and the price it is disposed of and is payable by the person making the disposal.

Section 556 of the Taxes Consolidation Act 1997 provides a measure of relief for capital gains which are attributable purely to inflation, commonly known as ‘indexation relief’. Finance Act 2003 amended section 556 such that indexation relief does not apply from the 2003 tax year onwards.

Indexation relief, however, continues to be available in computing a chargeable gain arising on the disposal of an asset where the deductible expenditure on that asset was incurred prior to the tax year 2003, with the relevant indexation multiplier being determined by reference to the year in which the expenditure was incurred.

Indexation relief was ended as a means of gradually broadening the tax base, and it has proved effective in that regard.

It is the case that when indexation was introduced in the 1970s inflation was very high. Since then, inflation has been consistently much lower even taking into consideration the inflationary spikes initiated by the COVID pandemic and recent geopolitical events.

It is also important to bear in mind, that there is no indexation of other taxes such as income tax, corporation tax or Capital Acquisition Tax.

The Programme for Government commits to maintaining a broad tax base to guard against the need for counter-cyclical fiscal policy in the event of a downturn and to prepare for future budgetary challenges relating to population aging. CGT is part of a system to ensure taxation is not focused solely on income tax and that those who benefit from gains in the value of their assets are included within the tax net on an equitable basis.

As with all taxes, CGT is subject to ongoing review, which involves the consideration and assessment of the rate of CGT and the relevant reliefs and exemptions from CGT as part of wider tax policy considerations.