Is the 41% Exit Tax Soon to be Scrapped? Michael McGrath to Review

fistophobia said:
Hang on, theres 20 billion invested by Irish people in ETFs ?
That must be a typo... maybe 20 million.
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20 billion it is, but that's a drop in the ocean given that 5 trillion is now invested in irish domiciled funds and 1 trillion of that is ETFs but a miniscule proportion of that is irish investors.
It's an awful pity Michael mcgrath was moved to Europe because he was the only one kicking ass in the government to get this done. Pascal Donohoe is largely indifferent and actually ignorant of the topic given his incorrect response I the Dail to a question on this taxation
 
Hold on, where's the €20 billion figure coming from?

It was €703 million by Q3 2019 (last time Central Bank looked at it)

Since ETFs are a relatively new investment instrument for households, growth in holdings of ETFs has not replaced households’ preference for direct holdings of quoted shares or investment funds (Irish households held €6 billion of quoted shares at end of Q3 2019)
 
Poor people only have money in bank accounts. Having enough spare cash to be looking at investments means you are not poor.
 
Corola said:
Poor people only have money in bank accounts. Having enough spare cash to be looking at investments means you are not poor.
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My household income is below the mean, but I own some shares and ETFs.

Okay, I'm not in poverty, fair enough.
 
Tax policy should favour poor people, yes. What's the alternative - tax policy that favours wealthy people?
 
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I think its valid to have tax policies that achieves any number of different goals. Encouraging the large number of the population that don't spend every penny they earn every month to invest for their own future rather than gift money to the banks sounds like good policy to me and not one that should be binned because there are poor people.
 
It's trivial to make a scheme less useful for high earners - for example do the standard Revenue copy/paste of the UK's ISA and limit it to some figure like 3000, 6000 p.a (UK ISA is 20,000 p.a).

My guess is the unhelpful suggestion of Minister McGrath(?) in trying to make this an investment in Irish startups wasted the time of everyone involved in the decision making. Especially when they found the EU wouldn't allow it. I'm happier there's no scheme than that dumb idea.
 
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Corola said:
Poor people only have money in bank accounts. Having enough spare cash to be looking at investments means you are not poor.
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Money in a bank account is still an investment. Probably not a good one, but still an investment.
 
Protocol said:
My household income is below the mean, but I own some shares and ETFs.
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At the risk of recreating a famous Monty Python sketch... my household income is zero (or, technically, negative) these days.
 
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But why should that derail the whole review, that should only have been a small adjunct to the reform of the exit tax regime. The EU is not stopping them abolishing exit tax or bringing in an ISA. I think this is them using excuses to stall and obfuscate
 
Seeing a simplification/reduction of the rate of this tax as a "tax break for the rich" is incredibly short sighted and symptomatic of the general poor financial literacy in this country. By simplifying the tax and even reducing the rate, it will increase the amount going into these products in the first place and they are also likely to grow at a far higher rate than cash so ultimately the tax take should increase significantly, even with a lower headline rate. This was the perfect budget to get something like this through and I fear nothing will happen now.
 
This taxation is also indirectly leading to difficulties recruiting high skilled, high earners to Ireland. These are the exact people that would be looking at these sort of investments. They look across at what UK is offering with ISA accounts, high CGT free allowances and cheaper and much more diverse housing options and its clearly an easy choice for them.
 
Djimi Traore said:
incredibly short sighted and symptomatic of the general poor financial literacy in this country.
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I'd argue that it's more to do with the financial illiteracy of TDs

Have a scroll through the register of interests to see how many TDs do not hold Shares, EFTs, Life Assurance Investments, AVCs, ARFs, State Savings,

Previous and Current Minister of Finance hold none.
 
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That's fairly damning alright but I'd imagine a lot of them have them in their spouse's name to avoid being labelled a "fat cat" investor and such just because they hold a few units of a Vanguard ETF.
 
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