Tuesday, 6 August 2019
Supporting small businesses would mitigate Ireland’s over-reliance on FDI
The Small Firm’s Association (SFA) today launched its Budget 2020 submission at which it called on Government to nurture entrepreneurship and give small businesses the opportunity to enhance their productivity and increase resilience.
Sven Spollen-Behrens, SFA Director, said: “Budget 2020 must place a clear focus on Ireland’s small business owners by providing certainty on costs and maintaining competitiveness. By doing so the Government would reduce the risk on our economy from an over reliance on foreign direct investment and Brexit, while seizing an important opportunity to future proof our economic model.
“The SFA continues to call for a whole-of-government national Small Business Strategy, with a roadmap towards significant policy goals: increased productivity, export diversification etc. Immediate changes in Budget 2020 would support the achievement of these goals.”
Mr Spollen-Behrens stated: “To meet the Government’s target of increasing domestic productivity by 1% per year, greater investment in education and upskilling for small business is needed. At a time when positivity among small businesses is at its lowest seen by the SFA, it is vital that Budget 2020 boosts confidence among our small business community.
At 33%, Ireland has one of the highest rates of capital gains tax (CGT) amongst developed economies. The SFA is calling for a reduction in CGT to 20% across the board, to make investing in a business in Ireland more attractive. CGT represents only 1% of the Government’s tax revenue, so there is very little to lose by reducing the rate, but the benefits could be significant. The SFA is also calling for CGT Entrepreneur Relief to be extended to compete with the UK scheme.
Mr Spollen-Behrens concluded: “Brexit poses one of the biggest challenges faced by small businesses in years. Supporting small businesses would mitigate some of Ireland’s current vulnerabilities and create a true entrepreneurial culture with benefits for entrepreneurs, employees and communities.”
Small business priorities for Budget 2020:
• Protect competitiveness by ensuring that Budget 2020 provides certainty for small business;
• Reduce the headline rate of CGT to 20% for all;
• Increase the lifetime limit for CGT Entrepreneur Relief to €15 million;
• Remove the €3 million cap on the value of business assets allowable for Retirement Relief for those aged 66 plus;
• Increase the Earned Income Tax Credit to €1,650 to equal the PAYE tax credit; and
• Use funding from increases in the National Training Fund levy for the Skillnet Programme.
For further queries and interviews, please contact Sven Spollen-Behrens, SFA Director, on firstname.lastname@example.org or 087 160 9403.