Richest 10% of Irish households own nearly half of all wealth

Household wealth more than doubled over a decade, but assets remain heavily concentrated among the wealthiest.

The institute examined potential wealth-tax models and how different approaches could affect households across Ireland's existing wealth distribution.

Its analysis comes against a backdrop of significant growth in household assets.

Between 2013 and 2023, total net household wealth more than doubled, while household debt fell from 25% to 11% of gross assets.

However, the overall increase in wealth has not been evenly distributed, with the richest tenth of households continuing to account for a substantial share of the country's assets.

The ESRI's findings also highlight the challenges involved in designing a potential wealth tax, particularly when deciding which assets should be included.

In a statement, the organisation said: “Applying a lower threshold to a narrow set of assets does not offset the exclusion of these major forms of wealth."

Property, land, farms and businesses are among the major assets that could be considered when determining the scope of such a tax.

Setting a high tax-free threshold would restrict liability to a smaller group of wealthy households. However, the value of a person's assets does not necessarily reflect their ability to pay an annual tax bill.

Some individuals may own valuable property or business assets while receiving relatively little regular income, potentially making it difficult to cover substantial tax payments.

ESRI researcher Rachel Slaymaker said: “Any consideration of an annual wealth tax would need to weigh up these factors, alongside its interaction with the wider tax system and whether reforming existing taxes could achieve the same objectives more effectively.”

The ESRI noted that its scenarios are illustrative and should not be treated as revenue forecasts or recommendations for government policy.