The Institute released its Pre-Budget 2026 Submission in which it has urged the Government to focus on three key areas in the face of an increasingly volatile geo-political climate:

• Enhance Ireland’s attractiveness as a location in the increasingly competitive battle for FDI.
• Create the environment for an ambitious, innovative and export-orientated SME sector.
• Bolster safeguards for taxpayers and increase investment in the tax collection system.

The Institute said that reforming the R&D tax credit will be critically important for Ireland’s continued competitiveness. It called for a number of measures, including:

• An increase in the R&D tax credit rate to “send a powerful message of intent to investors”.
• Change the outsourcing rules to encourage more R&D investment.
• The expansion of the definition of qualifying R&D expenditure.
• The simplification of claim administration to help small businesses in particular.

The Institute has also called for changes to the Key Employee Engagement Programme (KEEP) to address the low take-up in the scheme since its introduction in 2018, and amendments to legislation governing other share-based remuneration.

Furthermore, it has emphasised the importance of safeguards for taxpayers, calling for a number of measures including the retention of the option for taxpayers to request a private hearing at the Tax Appeals Commission; proportionate sanctions for administrative errors; further reform of the enhanced reporting requirements (ERR); and IT investment to support taxpayer compliance.

Speaking today, Anne Gunnell of the Irish Tax Institute said: “While Ireland has emerged largely unscathed from a succession of crises over the last number of years, the wholesale changes to the globalised trading order have led to an unprecedented threat to the heart of the Irish economic model. With an outsized share of large American multinational companies headquartered here, Ireland is uniquely vulnerable among EU member states to any escalation in US tariffs on imports.

“Future-proofing the Irish economy is paramount and Government must take bold steps to ensure Ireland remains a compelling proposition for multinational businesses already based here and a location of choice for the next wave of investment from diverse sources across the globe.”

Ms Gunnell noted that the German government’s announcement that it is allocating €46 billion for tax incentives to attract investment over the next four years has opened a new, challenging front in the battle for foreign investment. “In this context, the Government cannot afford to get caught in the headlights of matters beyond its control. Nothing should distract it from a laser-like focus on competitiveness.”

She said that it was critically important that the Government also prioritised the domestic economy. “Inward investment will always be essential to the success of a small open economy but broadening the productive base by investing in the domestic sector must be awarded the same priority.”

Read the Institute’s Pre-Budget 2026 Submission.