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PwC Ireland calls for CGT to be cut to 20%

Professional-services firm PwC Ireland has called for a reduction in capital-gains tax (CGT) as part of a tax package to address what it describes as “significant upheaval” arising from the US administration’s shift in trade policy. 

The firm also suggests a range of tax measures aimed at providing “certainty and stability” to encourage investment in housing. 

The measures are contained in PwC Ireland’s pre-budget submission, published today (10 June).

'Urgent reforms' of RZLT 

The firm calls for “urgent reforms” to the Residential Zoned Land Tax (RZLT), which it says is “causing further headaches”, rather than alleviating pressure in an area where immediate action is needed.  

It also suggests a reduction in CGT for retrofitted properties, a modernisation of the rules on Real Estate Investment Trusts (REITs), and a temporary VAT reduction on new, affordable homes to help improve viability and affordability for first-time buyers. 

Its key recommendation for businesses is a cut in CGT from 33% to 20%, while it also calls for increases in the capital-acquisitions tax (CAT) thresholds, CAT small-gift exemption, and CGT annual exemption. 

Other recommendations on business tax include: 

• Shareholder exits through share buybacks should be treated as CGT events, with clearer Revenue guidance to broaden relief and increase transparency,
• Businesses providing employee accommodation should benefit from a reduced tax burden,
• Rental income should be taxed at the 12.5% corporation-tax rate, and
• Reforming the taxation of Employee Ownership Trusts (EOTs) to support succession and employee ownership. 

Simplification 

The submission also calls for the four-year window of review by Revenue to raise queries or challenge a tax return to be reduced to one year, where a taxpayer provides details of a material transaction as part of its tax return. 

The firm also recommends a broader simplification of Ireland’s tax code to enhance competitiveness and attract investment, calling for “a clear, multi-year tax simplification roadmap”. 

PwC says that, while Ireland offers some valuable tax reliefs, such as tax credits for research and development, their “complexity and administrative burden” hinder access. 

“Budget 2026 presents a pivotal opportunity to implement far-reaching changes that will shape Ireland’s future trajectory, decisively addressing our nation’s pressing infrastructural, housing and climate challenges,” says Paraic Burke (PwC Ireland partner and head of tax).