SFA announces plan to create jobs

Monday, 5 October 2015

  • SFA announces proposals for job creation and retention
  • Every Government policy should be “job-proofed”
  • SFA calls for reform of the CGT Entrepreneurial Relief, the introduction of a childcare tax credit and enhancements to employee share options

The Small Firms Association (SFA) has called on the Government to tackle the high rate of jobless households in Ireland (23%). SFA Chairman, AJ Noonan, commented “the best way out of poverty is to have a job. It is encouraging to see the unemployment rate fall again to 9.4%, but we cannot become complacent. We need to think about where the next 100,000 jobs are going to come from. It is imperative that we support entrepreneurs to establish and grow their businesses, which will create more jobs, but we must also work to remove the blockers to entry and full participation in the labour market from an individual perspective.”

The SFA, which represents 8,500 small businesses, in every sector throughout Ireland, has proposed twenty-eight initiatives to create and sustain jobs in the Irish economy, in its submission on the Action Plan for Jobs 2016, to the Minister for Jobs, Enterprise & Innovation, Richard Bruton, TD.

SFA Chairman, AJ Noonan, stated: “Equally, the Government needs to remain alert to any threats to job creation. There is anxiety amongst small businesses about the increasing cost of doing business in Ireland, which is already 21% above the EU average. Recent announcements by Government relating to a potential increase in the National Minimum Wage by 50 cent, mandatory pension provision and a living wage has caused existing businesses to rethink their planned recruitment. The SFA believes that every Government policy should be “job-proofed”, as many different government departments have a potential impact on the cost of employment, which they may not realise or disregard in pursuit of balancing their own departmental budgets.”

One of the specific proposals contained in the submission is for the introduction of a childcare tax credit. “This would support working parents and increase participation rates, in particular female participation rates. Net childcare costs in Ireland are 27% of average earnings, more than double the EU average of 11.2%,” commented AJ Noonan.

The SFA has also called for significant reform of the Capital Gains Tax Entrepreneurial Relief to mirror the UK Scheme of 10%, to make it more effective. “This would increase the flow of investment in Ireland, encouraging job creation.”

Another proposal put forward by the SFA is for a review of the tax rules around employee share options. “The effective double taxation of employee share options is a major barrier to starting a company in Ireland, especially in the technology sector, as it hampers start-ups ability to attract the talent they need, in a very competitive sector of the labour market.”

SFA Chairman, AJ Noonan concluded, “Ireland’s 200,000 small businesses can deliver more jobs in the future, building on the 860,000 they already provide – over half the private sector workforce. 64% of SFA members intend to recruit in the next 12 months. The proposals contained in the SFA submission on the Action Plan for Jobs would ensure that those jobs – and many more – materialise over the coming years."


For further comment, please contact AJ Noonan, SFA Chairman, on Tel: 086 2592610.

Issued by Patricia Callan, SFA Director, Tel: 087-6999345 or e-mail: patricia.callan@sfa.ie, or tweet @SFA_Irl

The 28 proposals made by the SFA in its submission to the Minister for Jobs, Enterprise and Innovation are listed below. The full submission can be found on the SFA website, www.sfa.ie


Priority actions
1. Revise Capital Gains Tax Entrepreneurial Relief
2. Reduce Capital Gains Tax rate to 20%
3. Introduce voluntary PRSI for the self-employed
4. Introduce a childcare tax credit
5. Improve access to public procurement for small firms
6. Invest in training for owner-managers
7. Revise the tax rules on employee share options
8. Reduce the bankruptcy period to one year and create structures to encourage second chance entrepreneurship
9. Ensure all areas have access to broadband and good mobile service

Theme: Assisting indigenous businesses to grow
10. Improve the Employment and Investment Incentive Scheme
11. Improve ease of casual and part time employment for jobseekers
12. Assist small firms to engage in more R&D by introducing an ‘R&D Tax Credit Lite’
13. Improve access of indigenous SMEs to research funding
14. Grant aid for domestically trading businesses
15. Amend the Transfer of Undertaking Regulations to encourage recruitment

Theme: Driving entrepreneurship and start-up companies
16. Phase in employer PRSI for new companies

Theme: Delivering the potential of all regions
17. Freeze the National Minimum Wage for three years
18. Promote Ireland as a sports tourism destination

Theme: Improving access to finance for SMEs
19. Limit right of banks to ask for personal guarantees
20. Develop a channel to access SBCI funding separate to the pillar banks
21. Extend Small Claims Remit for B2B Debts
22. Introduce a Finance Voucher Scheme
23. Increase threshold for investment of private pension funds in business

Theme: Realising sectoral opportunities
24. Retain reduced 9% VAT rate in hospitality and related sectors
25. Revise the Fair Deal scheme to address demographic challenges and create jobs in the nursing home sector
26. Clamp down on the black market

Theme: Developing and enhancing the skills base
27. Change apprenticeship model

Theme: Developing and deepening the impact of foreign direct investment
28. Make Ireland attractive for angel investors and venture capital. Enhance learning and procurement opportunities with MNCs for indigenous business.