{"id":323698,"date":"2026-03-01T16:48:17","date_gmt":"2026-03-01T16:48:17","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/323698\/"},"modified":"2026-03-01T16:48:17","modified_gmt":"2026-03-01T16:48:17","slug":"canada-or-sweden-simon-harris-considers-irelands-savings-future-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/323698\/","title":{"rendered":"Canada or Sweden? Simon Harris considers Ireland\u2019s savings future \u2013 The Irish Times"},"content":{"rendered":"

Minister for Finance Simon Harris<\/a> is weighing options for a new savings and investment scheme<\/a>, with two foreign models standing out: Canada\u2019s Tax-Free Savings Account (TFSA) and Sweden\u2019s Investeringssparkonto (ISK).<\/p>\n

With a TFSA, Canadians can invest up to $7,000 Canadian dollars (\u20ac4,339) a year, carry forward unused allowances and watch gains and withdrawals stay completely tax-free. While the \u00a320,000 (\u20ac22,844) annual limit on the UK\u2019s Individual Savings Account (ISA) is surely far too generous to emulate here, Canada<\/a>\u2019s TFSA is a flexible, attractive option, letting investments snowball through tax-free compounding.<\/p>\n

Sweden<\/a>\u2019s ISK takes a different approach. Like Canada, there\u2019s no capital gains tax on disposal. Unlike Canada, there\u2019s no annual cap on contributions, but savers pay a small yearly tax \u2013 usually about 1 per cent \u2013 on the account\u2019s value, with the first \u20ac28,000 effectively tax-free. The system is simple, automatic and predictable.<\/p>\n

Both models are popular. For most investors, Canada\u2019s system is clearly more generous, letting you hold stocks for decades without the state touching your gains. The ISK, by contrast, trims returns each year, including in weak market years. <\/p>\n

However, Harris may be tempted to go for a Swedish-type system. There are three reasons for this. <\/p>\n

One, it offers a steady annual tax take and may be more politically defensible, avoiding large untaxed pools of savings.<\/p>\n

Two, Sweden\u2019s annual tax reduces the temptation to divert pension savings into a tax-free wrapper. Note that in 2023, more savers contributed to TFSAs, and in larger amounts, than to RRSPs, Canada\u2019s main pension vehicle. Pension-substitution risk is real, with even modestly generous tax-free accounts potentially pulling contributions from retirement savings.<\/p>\n

[\u00a0Lessons from abroad on Ireland\u2019s new savings scheme for the \u2018middle class\u2019Opens in new window<\/a>\u00a0]<\/p>\n

Three, the TFSA is a popular tax vehicle, but not necessarily a driver of the deep stock market culture that European policymakers want to foster, with roughly four in 10 Canadians using it mainly or exclusively for cash. <\/p>\n

In contrast, Sweden\u2019s annual charge makes the ISK unattractive for deposits and nudges savers toward stocks. Irish investors would love a tax-free wrapper, but one can see why the ISK is being studied as a blueprint across Europe. Nudging savers into stocks while steadily funding the State, it looks like a rare win for both investors and policymakers.<\/p>\n","protected":false},"excerpt":{"rendered":"Minister for Finance Simon Harris is weighing options for a new savings and investment scheme, with two foreign…\n","protected":false},"author":2,"featured_media":323699,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[72,289,61,60,70,1859],"class_list":["post-323698","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-canada","tag-ie","tag-ireland","tag-simon-harris","tag-sweden"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/323698","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=323698"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/323698\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/323699"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=323698"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=323698"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=323698"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}