Budget 2014 must build on recent positive signs in the economy and further the momentum that will lead to increased growth and job creation. Above all else the Government must do no harm by increasing taxes on, or the cost of, employment.
Chambers Ireland are suggesting five key policy priorities that, if implemented, would build upon the recent positive economic indicators. Government must show a commitment to business as this is the most effective route to sustainable growth, economic stability and job creation.
1. Introduce a special, time-limited, reduced VAT rate for the home Repair, Maintenance and Improvement sector. This could incentivise consumers to invest in their home and, in turn, support domestic demand.
2. Make sure Small and Medium-Sized Enterprises (SMEs) are given access to the working capital they so desperately need to allow them to grow, develop and create new jobs. Raise the qualifying amount for companies to use cash accounting for VAT, enhance the profile of the Seed Capital Scheme and improve the Employment Investment and Incentive Scheme.
3. Use savings achieved from Local Authority mergers and the arrival of the Local Property Tax to support retailers and other small businesses in town centres.
4. On the spending side, resist the temptation to close Departmental funding gaps via taxation rather than cost containment measures.
5. The special VAT rate of 9% for the hospitality sector must also be maintained to provide further security for that vital employment sector across all regions in the country.
“We may well be at a turning point. The progress made to date shows that the Government has made some sound decisions but there are further tough choices ahead. Government must not be distracted from its main task of closing the deficit and getting the economy back onto a sustainable footing. That will only be achieved by giving business the support it needs to grow, develop and create jobs,” said Madeleine Quirke, CEO of Wexford Chamber.