Budget 2018 is a step in the right direction for small business
This afternoon, Paschal Donohoe TD, Minister for Finance and Minister for Public Expenditure and Reform, announced Budget 2018 in the Dáil.
The SFA has welcomed Budget 2018 as a step in the right direction for small business. SFA Director, Sven Spollen-Behrens, commented: “Budget 2018 is a signal of support for the small businesses of Ireland. These businesses, which employ half the private sector workforce, welcome in particular the announcement of the Key Employee Engagement Programme (KEEP), the retention of the 9% VAT rate for the tourism sector and the introduction of a Brexit loan scheme for small businesses.
“The introduction of a tailored employee share options scheme (KEEP) for small business is an important initiative, which has the potential to deliver improved management capacity, staff retention and productivity. Currently, only 6% of employees in Ireland are shareholders in the company where they work, compared to the EU average of 22%. Our members are keen to see the detail of the scheme and to start using it to help their businesses to grow and reward their key employees.
“Businesses know first-hand that the infrastructure challenge facing the country is acute, following a decade of under-investment. There were strong signs today that the quantum of spending is increasing and specific projects of strategic importance will receive funding. These projects must be progressed without delay, in order to enhance the capacity of the economy.”
“The Earned Income Tax Credit for the self-employed has come closer to parity with the PAYE Tax Credit, with today’s announcement of an increase of €200 to €1150. The SFA has fought for many years to end the discrimination that has too long been a feature of the income tax system; we will continue to campaign for the gap between the EITC and the PAYE Tax Credit (€1650) to close fully in next year’s Budget.
“There are, of course, aspects of today’s announcement which will pose challenges for small firms. Chief among these are confirmation of the 30c increase in the minimum wage and the risk of increased business costs through the rise in commercial stamp duty. Our members are also concerned about the increased National Training Fund levy; there are already concerns about the use of this fund and small firms will be insisting on much stricter deliverables in the future.
“On capital gains tax, the Minister was notably silent. The SFA has highlighted that increasing the limit for CGT Entrepreneurial Relief must be a key element of Ireland's response to Brexit. Instead, the Irish relief remains uncompetitive with the UK equivalent, meaning we will miss out on mobile investment and entrepreneurship.”