Ireland has experienced a high degree of economic success in recent years. Despite this, Ireland stands at a pivotal juncture. The current global economic uncertainty and the ever-changing business environment, both at home and abroad, present ongoing challenges.
So how can we best secure our economic future? Our pre-Budget submission sets out a range of tax policy proposals we believe will help navigate the evolving geopolitical and tax landscape and reinforce Ireland's position as a premier destination for business.
Pictured at the roundtable discussion with senior leaders and founders of companies from a cross-section of the economy to discuss our pre-budget submission. (l-r) Orla Gavin, Head of Tax, KPMG, Minister for Finance, Paschal Donohoe TD, Olivia Lynch, Head of Tax Markets, KPMG and Tom Woods, Head of Clients, KPMG.
Accelerating investment and innovation
KPMG’s pre-Budget 2026 submission calls for introducing strategic tax measures that could help accelerate investment and innovation.
“The current global economic uncertainty emphasises the need for a nimble approach to tax measures in Budget 2026 focused on propelling business activity forward. To build resilience in the economy, both for FDI and domestic business, Government should focus tax measures to position Ireland as an innovation hub, encourage greater investment in housing, reduce the cost of employment and stimulate investment in our SMEs,” said Orla Gavin, Head of Tax, KPMG.
The current global economic uncertainty emphasises the need for a nimble approach to tax measures in Budget 2026 focused on propelling business activity forward.
Enhancing our competitiveness
Critical to enhancing our competitiveness is improving our infrastructure across housing and energy, which should be supported by tax policy measures.
“Government must also ensure Ireland’s interests are protected as the EU and OECD’s respond to US trade and tax measures. As Ireland is disproportionately exposed to international tax policy shifts it is imperative that we have a strong voice in the formation of any response to the US’s stance on BEPS and trade.”
Key recommendations
Enhance Ireland’s competitiveness
Reduce the administrative burden and cost of doing business in Ireland by simplifying the tax code, introducing a territorial regime and reducing compliance costs
Position Ireland as an innovation hub
Increase the general R&D Tax Credit to 35% and introduce a 50% R&D Tax Credit for innovation in green technologies. Incentivise top researchers to relocate to Ireland
Reduce the cost of employment
Increase the entry point to the marginal income tax rate to align with the average wage. Cap the amount of income subject to PRSI to €75,000 for employees’ PRSI and €100,000 for employers’ PRSI
Incentives for employer developed accommodation
Incentivise employers to develop employee accommodation and allow a corresponding BIK exemption where the employee earns less than €50,000
Safeguard Ireland’s interests at an EU/OECD level
It will be crucial that Ireland’s interests are appropriately represented in the formation of any EU response to the US concerns on BEPS and the US trade tariffs
Re-introduce “Section 23” style relief
A controlled and targeted relief would encourage conversion of commercial properties for residential use and incentivise individuals to finance the development of new residential units for letting
Encourage sustainable behaviour
Introduce a super deduction for expenditure on green technology and buildings.
Increase the tax-free lump sum payable on retirement where some or all of the lump sum is derived from approved ESG funds
Stimulate growth in SMEs
Improve access to finance by enhancing and simplifying EIIS and introducing measures to encourage individuals to invest in domestic enterprises.
Enhance the CGT regime to encourage investment and reward entrepreneurial risk.
Introduce a tax incentive for recruiting top tech talent to Ireland, extend KEEP beyond 2025 and SARP to Irish indigenous businesses
Download our submission in full
Get in touch
The measures unveiled in the forthcoming Budget 2026 will have far-reaching implications for businesses across Ireland. If you have any inquiries, comments, or wish to explore further, we are here to assist.
Feel free to get in touch with Orla Gavin, our Head of Tax - we'd be delighted to hear from you.
Orla Gavin
Partner
KPMG in Ireland
