Wednesday, 10 June 2015
Speaking to over 300 delegates at the SFA Annual National Conference, sponsored by RaboDirect this morning (Wednesday, 10 June), the Chairman of the Small Firms Association, Mr AJ Noonan said that a return to ‘a business as usual attitude’ for Government is not an option. “Managing costs, supporting capital investment and engaging in real tax reform, is essential to maintaining Ireland’s competitiveness.”
The SFA Chairman released the findings of the SFA’s Summer Business Sentiment Survey which shows that 71% stated that their business is improving, whilst just 8% felt it was disimproving, with 21% remaining stable. 64% of respondents intend to take on new staff this year. However, just 41% of small businesses expect to increase pay this year (by 2% median), with 56% maintaining pay rates and 3% actually reducing rates.
SFA Chairman, AJ Noonan commended the 200,000 small business owners “who have shown great leadership, entrepreneurship and innovation during the crisis, guiding their firms back to growth. It is critical that the Government now do the right things to secure our future over the long term and not just until the next general election”, stated Mr AJ Noonan.
Mr AJ Noonan commented: “The “leit motif” of government policy statements has been “it’s all about jobs!” How can this position be squared with increases in public sector pay and a Low Pay Commission which is told by the Minister in a public statement that the minimum wage will increase, even before the Commission has held its first meeting. Mandatory pensions are being considered, increases in postal and insurance costs and significant pressure on wages in the exposed sectors of the economy.”
“Our economy is recovering. Growth is strong. However, while our recovery is real, it is still not even across the economy. Not all companies are recovering or growing at the same rate and some regions have yet to feel any recovery. The economy in money terms is still below its pre-crisis peak and overall price levels are still below where they were in summer 2008. This needs to be reflected in wage expectations. This is the perfect time to invest in our future, not burden ourselves with price and wage increases which will not only hinder the recovery, but waste the gains and cost jobs”, argued SFA Chairman, AJ Noonan.
“Instead of increasing wages blanketly, we should reduce income tax and capital taxes in the next budget, as this will boost consumer spending generally. We should invest heavily in infrastructure, particularly to deal with housing shortages,” stated Mr AJ Noonan.
“How are we expected to create wealth when Capital Taxes are among the highest in the OECD never mind the EU? The upcoming budget must also encourage people to reinvest their gains; a capital gains tax of 33% does exactly the opposite and reduces the number of transactions. What is needed is a simple no nonsense 20% CGT rate for existing companies. History has shown that this is self-financing, as when the rate reduces, the net return to the Exchequer increases. In Budget 2016, we are also seeking reforms of CGT for entrepreneurs to make it competitive with the UK 10% offering, and to encourage more entrepreneurs to reinvest in and start-up other small businesses in Ireland. This will cause massive loss of revenue to our Exchequer if we don’t tackle it this year”, stated Mr AJ Noonan.
In conclusion, Mr AJ Noonan stated that the disparity of treatment between the self-employed and PAYE workers should be ended. “It is a scandal that taxpayers are not treated equally but discriminated against because they choose to be self-employed and take risks in setting up businesses. If it is “all about jobs”, then it must first be about small business and their owners and getting the business environment right”.