In its mid term update on its Funds Sector Review, the Department of Finance said of the 140 responses submitted by private individuals, a considerable number were concerned exclusively with taxation. More specifically, many submissions by private individuals referred to the taxation regime for Exchange Traded Funds (ETFs). The Department said the submissions convey a general perception that the taxation of investment products, and of ETFs in particular, is a major barrier to increasing retail investor participation in Ireland. It added these views were also reflected in the submissions received from industry participants and the Central Bank which highlighted the apparent disconnect between Ireland’s role as a global hub for the funds industry and the low levels of domestic household investment into investment funds. Can you discuss the taxation of investments in Ireland and why they are perceived as ‘a major barrier’ in increasing retail investor participation?
