Dáil Éireann Debate, Tuesday - 20 June 2023
259. Deputy Damien English asked the Minister for Finance the extent of the domestic financial services and the international financial services sectors in Ireland in terms of the number of people employed and the value to the Exchequer by way of corporation taxation; his views on the future growth of both these sectors in Ireland; and if he will make a statement on the matter. [29820/23]
Amharc ar fhreagraOverall, the financial sector accounted for some €2.7 billion of corporation tax receipts in 2022. This was around 12 per cent of the corporation tax yield. According to the CSO, corporate taxes paid by the financial sector were split broadly equally between domestic (48 per cent) and foreign owned (52 per cent) financial corporates in 2021. A breakdown of the financial sectors corporation tax receipts for 2022 is not yet available from the CSO.
The domestic economy is poised to grow at a robust pace this year, with the pace of growth expected to pick-up over the course of the summer as inflation continues to ease. The financial services sector will have an important role to play in ensuring the resilience of this growth, by enabling broad based and sustainable investment across the domestic economy. This role takes on particular significance given the rapid tightening of monetary policy over recent months, and the greater financing burden faced by both businesses and households.
In relation to the international financial services sector specifically, the current estimate from the enterprise agencies IDA Ireland and Enterprise Ireland is that direct employment in this sector stood at around 56,000 at the end of 2022. This is an increase of over 3,000 in the numbers employed compared to the end of 2021. In addition to these high-value jobs, there are many more thousands of people who are employed indirectly in professional services for which the international financial services sector generates a demand.
Ireland for Finance is the whole-of-Government strategy for the further development of Ireland’s international financial services sector. The Update to Ireland for Finance was launched in October 2022 and its vision is for Ireland to continue to be a top-tier location of choice for specialist international financial services and to enhance and protect our future competitiveness. The employment target of the updated strategy is to achieve a further net increase of 5,000 people in direct employment in the international financial services sector (above the target set out in the previous iteration of the Ireland for Finance strategy). This target applies for the period of the updated strategy, from January 2023 to December 2026.
The nature, scale and complexity of Ireland’s international financial services sector is changing and will continue to change in a number of ways as a result of the financial services investments won in recent years, including both firms relocating from the UK following Brexit and firms looking to set up operations in the EU for the first time. The industry in Ireland has become broader and more diverse with more firms carrying out a greater range of regulated activities than at any time.
