Young people drawn to 'risky' financial content online, warns Laois councillor
Cllr Conor Bergin has called for a review of tax rules on investments for ordinary people
Tax rules on personal investments by ordinary people need to be reviewed to protect against "riskier" schemes, according to a Laois councillor.
Due to the complexities and low return on savings and investments in Ireland, people either do not engage with investing or are instead drawn to more riskier schemes, Councillor Conor Bergin has argued.
The Borris-in-Ossory councillor has requested Laois County Council to call on the Minister for Finance and Tánaiste Simon Harris to review the current tax rules that apply to personal investment products in order to make it easier for ordinary people to save and invest for the future and to support long-term investments.
"We're talking about ordinary people who are working hard, saving when they can and trying to plan for the future," Cllr Bergin said at the meeting of Laois County Council on Monday, March 30.
There is over €170 billion sitting in household deposits across the country, most of which are earning little to no returns.
Cllr Bergin stated that any real returns are being reduced by inflation and people's savings are "overtime eaten by inflation."
He argued the current system is not working, with some investment funds being taxed up to 41%.
"When people try to take the next step, invest modestly and sensibly, they're met with unusually high tax rates and complexity," he told the council.
"The bottom line is, this isn't the international norm. In most European countries, people are actually taxed when they sell their investment, not taxed on an ongoing basis."
As a result of this, Cllr Bergin explained that most people in Ireland end up not engaging at all.
However, there is an interest among young people but they are often exposed to untrustworthy financial advice online, he said.
"At the moment the reality is a lot of young people are exposed to all sorts of financial content online, some responsible and some not. We need to provide clear and safe ways for people to invest responsibly. Otherwise people are drifting towards riskier options which is what is happening at the moment," Cllr Bergin stated.
Some of these risky investments include cryptocurrency, which Cllr Bergin described as "garbage." He warned that young people are being drawn into online scams and there needs to be more awareness on this topic.
He emphasised that this motion is about encouraging clarity, financial literacy and protecting people's investments.
Minister for Finance Simon Harris outlined further details of the Government's proposed plan to encourage households to invest on Tuesday, March 31.
Funded by the Local Democracy Reporting Scheme