A Programme for Government (PfG), negotiated between Fianna Fáil, Fine Gael and the Green Party was published on 15 June 2020. If ratified by the respective parties, it will form the basis of government policies over the next five years.
For the most part, taxation is dealt with in the form of a number of statements of principles, some of them somewhat vague, although there are also a number of specific measures proposed. At a macroeconomic level, the government will borrow to fund an investment-led recovery, with a particular focus on capital expenditure in areas such as health, housing, infrastructure and climate action, and investment in skills and retraining. While the PfG does not rule out increases in taxation, it states that any rise will be focussed on behaviours with negative externalities, such as plastics, sugar and carbon rather than by increasing direct taxation.
All of this will be set out in more detail in an economic recovery plan to be published at the time of Budget 2021 in October.
The outcome of this, and other reviews proposed in the PfG, as well as October’s economic recovery plan will play a key role but the PfG at the very least gives a good indication of the direction of taxation policy over the next five years.