Dáil Éireann Debate, Thursday - 22 June 2023
124. Deputy Pearse Doherty asked the Minister for Finance for an update on his Department’s review of the IREF and REIT tax regimes; his views on whether IREFs and REITs are paying sufficient tax; and if he will make a statement on the matter. [30177/23]
View answerInstitutional investors have an important role to play in the Irish property market. While it is important to facilitate collective investment in the Irish property market through appropriate regimes, it is equally important to ensure that, where such investment brings a profit, a fair share of tax is paid. Taxation occurs primarily at the level of the investor rather than within the fund as is common for investment funds generally. Additionally, in the case of both Irish Real Estate Funds (IREFs) and Real Estate Investment Trusts (REITs), withholding taxes apply on distributions to investors to ensure collection of tax revenues. In 2019, my predecessor Minister Donohoe made a number of significant amendments to both regimes to ensure appropriate levels of tax are paid by investors in Irish property.
In its 2022 Report, the Commission on Taxation and Welfare recommended that a review of the REIT and IREF tax regimes with regard to institutional investment in the Irish property market should be undertaken. This recommendation has been incorporated into the Terms of Reference for the “Funds Sector 2030” Review which I published on 6 April this year.
In line with the Terms of Reference, the Funds Review will consider:
“an examination of the regimes for Real Estate Investment Trusts (REITs) the Irish Real Estate Funds (IREFs) and their role in the property sector, including how they support housing policy objectives”
The work of the Review has now commenced and a public consultation paper will be launched later this month. I would encourage all stakeholders with an interest in matters relating to the IREF and REIT regimes, including Deputies, to fully engage with the Review. The Review Team will present a draft Report to me by summer 2024.
