Today on the eve of Budget 2019, ISME, the Irish SME Association reiterates its call for Government to adopt a budget that is pro-jobs, and pro-enterprise . Ireland needs a budget focussed on sustainable growth for everyone.
ISME has made a number of recommendations on key areas including taxation, spending on infrastructure, international competitiveness and education and training.
Budget 2019 gives the Irish Government an opportunity to foster indigenous growth by supporting Irish business through increased capital expenditure on essential infrastructure.
As Brexit approaches, our excessive dependence on foreign direct investment remains risky. The costs of rent or purchase of even the most basic of family accommodation have become prohibitive, and have led to severe upward pressure on wages. The government must address this through aggressive supply-side measures.
ISME’s priorities for Budget 2019 are:
- Implement the key tax recommendations made by the Irish Tax Institute, removing all tax discrimination against self-employed workers.
- Reduce the punitive 23% VAT rate to 21%, and retain the 9% rate.
- Our taxes on property, commercial rates and LPT, need to be brought up to date and made fit for purpose.
- Spending on infrastructure should be prioritised above current account spending, and we should see a plan to increase it to 4% of GNI*. Capital expenditure must take priority over increasing current expenditure. We should nationalise the wholesale telecoms distribution network, in the same way as we do the electricity and gas grids.
- Our Inheritance Tax regime must be updated, both to increase yield, to encourage more intensive use of assets, and to incentivise the scaling-up rather than sale of family businesses.
- In light of the critical importance of international competitiveness for a small open economy, we recommend an increased scope for the Irish Fiscal Advisory Council (IFAC), to include in their remit ongoing commentary on the work of the National Competitiveness Council (NCC), so that the NCC has an external advocate.
- Our further education and training regime is not consistent with activating a bigger workforce, or training the unskilled. Ireland’s performance on NEETs is markedly worse than the OECD average. We must divert spending from non-performing programs towards employer-led ones which will expand our workforce in size, learning, and expertise and prepare Ireland for Manufacturing 4.0.