![\"\"](\"https:\/\/www.newsbeep.com\/ie\/wp-content\/uploads\/2026\/02\/001e74ed-614.jpg\"\/)
<\/p>\nA new State-backed savings scheme is on the way for those fortunate enough to have money to invest, amid warnings it must not be a tax break that’s primarily useful to the wealthy.<\/p>\n
The project would be different from the SSIA accounts which ran until 2002, when deposits were topped up with a 25% giveaway from the State.<\/p>\n
Instead, the new initiative is more likely to offer savers a range of funds invested in the stock market, which will deliver limited tax-free returns.<\/p>\n
Minister for Finance Simon Harris told RT\u00c9’s This Week that he will introduce the scheme, but the specifics are still to be worked out.<\/p>\n
Ireland is lagging behind many other European countries which already have state-backed accounts to encourage investment.<\/p>\n
Here, thousands of consumers have their savings in bank accounts that achieve lower returns than money invested in the stock market.<\/p>\n
In fact, Irish banks make enormous profits from offering low rates to Irish depositors.<\/p>\n
One calculation suggests they paid just 0.25% interest on their entire stock of deposits in the first six months of this year, far below inflation, which is now at 2.7%. So, the value of savings is being eroded.<\/p>\n
If Ireland follows other European countries, consumers could put money into a variety of funds with different risk profiles.<\/p>\n
At present, Irish investors are taxed at 33% on any gain on shares and 38% on many funds.<\/p>\n
<\/p>\n
It is likely the Department of Finance would consider giving tax-free returns up to a certain point and gains beyond that would be subject to a new levy.<\/p>\n
Michael Healy, managing director of financial group IG in the UK and Ireland, which handles 900,000 of these investment accounts in Britain, says any scheme “needs to be accessible for a broad range of people but not a tax break for the ultra-rich.”<\/p>\n
Usually, there is a cap on how much can be invested. In the UK it is limited to \u00a320,000 per annum.<\/p>\n
He adds these schemes “reduce dependence on the State pension. It is a win-win for government and consumers.”<\/p>\n
Similar schemes are operating or under way in Poland, Sweden, France, Japan and Canada.<\/p>\n
Ireland is beginning to move in tandem with the EU in introducing a pan-European financial market to mobilise investments across the bloc, called the Savings and Investment Union.<\/p>\n
“Participation rates in other markets are high. In Sweden it was introduced in 2012 and 30% of the country’s GDP is in these accounts now,” Mr Healy said.<\/p>\n
Introducing such a scheme is advocated by the banks, which is unsurprising as they are likely to make money from it.<\/p>\n
The Government will need to design the project carefully to ensure the fees charged by financial institutions are transparent and do not eat into investors’ returns excessively.<\/p>\n
Another pitfall for the Coalition is that it needs to be cautious about encouraging people to invest in stock markets.<\/p>\n
In 1999 thousands of investors were badly burned when they poured money into the State’s privatisation of Eircom, now called eir.<\/p>\n
Its shares briefly rose before falling dramatically following a stock-market flotation wiping out the savings of thousands.<\/p>\n
The adage of not putting all your eggs in one basket is important when investing.<\/p>\n
Most funds are likely to be across a broad range of companies, in different regions such as the US, EU and Asia, and in different sectors such as tech, pharma and manufacturing.<\/p>\n
![\"Simon](\"https:\/\/www.newsbeep.com\/ie\/wp-content\/uploads\/2026\/01\/0023c1c7-614.jpg\"\/)
\nSimon Harris said the initiative will be a key priority over the next two budgets<\/p>\n
This generally helps to ensure investors are insulated against the vagaries of the markets but only if they keep the money there for a period of years, so it won\u2019t be a ‘get-rich-quick’ scheme.<\/p>\n
It is possible the Department of Finance could offer a cash deposit option too, as happens in the UK.<\/p>\n
But the plan to introduce such a new investment scheme has critics.<\/p>\n
Savers will be people who already have some money, and the Government intends to give them a tax break.<\/p>\n
Trinity College Dublin economist Dr Barra Roantree said: “Courting household deposits with tax breaks is therefore inevitably going to amount to tax cuts for the highest-income households who hold lots of deposits, not the ‘squeezed middle’ who – however torturously defined – don\u2019t have a whole lot of deposits crying out to be invested.”<\/p>\n
He argued the scheme “will do little to increase savings and investment, but instead just benefit existing higher-income savers along with their accountants and banks.”<\/p>\n
Another consideration is that there will be some tax foregone by the State at a time when there are concerns about Ireland being over-reliant on money paid by multinationals.<\/p>\n
But Minister Harris’s position is that the project would solve the problem “of hard-working people doing the right thing – and that is saving – but not being rewarded for it.”<\/p>\n
The initiative will be a key priority over the “next two budgets,” he says.<\/p>\n
During the 2024 General Election, Fine Gael suggested a savings account for children and it is possible a later version of the scheme could be targeted at under-18s.<\/p>\n
Meanwhile, the first accounts availing of the new scheme could be opened in 2027.<\/p>\n","protected":false},"excerpt":{"rendered":"A new State-backed savings scheme is on the way for those fortunate enough to have money to invest,…\n","protected":false},"author":2,"featured_media":309534,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[42,43,40,38,41,39],"class_list":{"0":"post-309640","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-headlines","8":"tag-headlines","9":"tag-news","10":"tag-top-news","11":"tag-top-stories","12":"tag-topnews","13":"tag-topstories"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/309640","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=309640"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/309640\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/309534"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=309640"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=309640"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=309640"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}