Finance Minister Simon Harris has indicated that the Irish government is considering reforms to the controversial deemed disposal tax on retail investments in Budget 2027, alongside the rollout of a new State-backed Personal Investment Account.

Under current rules, investments in exchange-traded funds (ETFs) and collective investment schemes are subject to an automatic tax trigger every eight years on paper gains, regardless of whether the investor has sold their holdings. Originally introduced as an anti-avoidance measure in 2006, the taxation rate was reduced from 41% to 38% in Budget 2026.

Speaking on the sidelines of a European Parliament event in Strasbourg, Harris stated that Ireland needs to "move beyond" deemed disposal to encourage retail investment and address the lack of an active retail investment culture in the country. He noted that broader changes to the tax regime would be examined alongside the government's upcoming personal investment account framework.

The proposed State-backed Personal Investment Account, expected to be launched next year, aims to provide a simplified tax structure for everyday investors. Harris pushed back against criticism suggesting that reforming deemed disposal would render the new scheme redundant, arguing that both reform levers are necessary to support Irish savers and bring capital out of low-yield bank deposits.

Financial industry bodies and retail investor advocates have long criticized deemed disposal for penalizing long-term compounding and creating administrative burdens. Further details on the proposed tax changes and the roadmap for retail investment are expected to be reviewed as part of the annual budgetary process leading into Budget 2027.