- Key tax recommendations made by Irish Tax Institute should be implemented
- Reduce the punitive 23% VAT rate to 21%, and retain the 9% rate.
- Spending on Infrastructure must take priority over current account spending
- Wholesale telecoms distribution grid should be nationalised
- Increased scope for the Irish Fiscal Advisory Council (IFAC) needed
- Investment in housing and training programmes essential
ISME, the Irish SME Association (October 9th) on the eve of Budget 2019 reiterates its call for Government to adopt a budget that is pro-jobs, and pro-enterprise. The Association says Ireland needs a budget focussed on sustainable growth for everyone.
Commenting on this, ISME CEO, Neil McDonnell said:
“It’s clear that our current tax strategy primarily suits foreign-owned Multinational Corporations (MNCs). As the reality of Brexit approaches, our excessive dependence on foreign direct investment is risky. It is time to foster indigenous growth through increased capital expenditure on essential infrastructure.
There’s still not enough being done to encourage people to start their own businesses. This budget must give potential business owners good reasons to set up a business. “
Mr. McDonnell added:
“Tomorrow’s budget must resist the temptation to yield to populist demands. Budget 2019 must provide sustainable growth for the economy, not prioritise the state sector. Investment in our infrastructure and housing, and in effective training programmes that upskill workers and generate new employment; these are all key areas government must invest in.”
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.
ISME CEO, Neil McDonnell, concluded:
“While we face many challenges in 2019, one issue that unites all political and economic strands is that of affordable housing and homelessness. 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. Government must address through aggressive supply-side measures.”
ENDS.
For further information, please contact
Wayne Tobin, Press, Policy and Research Officer
T: 01 6622755
E: wayne@isme.ie
