Pre Budget Submission 2015
“A Pro-Business Budget”
Background
North Kildare Chamber is the largest business organisation in Kildare. The Chamber has a growing membership of over 300 businesses and a simple mantra “to protect, maintain, enhance and promote business in Kildare” We have consulted with our membership in regards to our pre budget submission.
If the Irish government is serious about job creation then they must promote competition by removing current policies which act as barriers to business expansion and employment creation. This will be the most effective way to assist the country in continuing on an upward trajectory of growth.
Exchequer returns continue to outperform projections. Government must utilise this opportunity to invest in delivering policies which will secure sustainable economic growth. Capital investment plays a key role in this.
Budget 2015 must:
Return confidence to ignite growth;
Implement measures to improve finance for SMEs which continues to remain a key barrier to growth;
Address the rising costs of doing business, to ensure that Ireland remains a competitive location in which to invest and do business;
Introduce an enhanced suite of policies to support Entrepreneurs, who are the back-bone to innovative growth on our island economy;
Deliver on balanced regional growth.
Government plays a critical role in delivering certainty to the economy by adopting policies which support business efficiencies and reduce the costs of doing business.
Economic activity must be encouraged through a system that is sensitive to, and recognises the benefit of, investment, access to working capital, growth and employment.
Key points
It is vital that Ireland remains an attractive and competitive location in which to invest. Government must maintain their commitment to retaining Ireland’s 12.5% Corporation tax.
Government policy measures to support the hospitality sector via the 9% VAT rate has been successful in driving competitiveness and securing jobs for the sector. Certainty over the preservation of this rate will allow businesses to make informed decisions and generate additional employment. North Kildare Chamber calls for the retention of the VAT rate till 2020. The continued growth of the Hospitality sector in Kildare will prosper even further with the 9% VAT rate remaining in place till 2020.
Chamber call for a lower rate of PRSI for employers. The standard rate of employer PRSI is 10.75%. A lower rate of 8.5% applies to employee’s earnings which are €356 or less per week. As part of the 2011 Jobs Initiative, the Minister for Finance reduced the rate to 4.25% until year end 2013. Since this rate was abolished, it has hampered job creation. We call to reintroduce this tax rate of 4.25% for 5 years so to assist with sustaining and creating jobs in our economy.
Reduce VAT on residential property construction. The Chamber Network cannot understand the logic of Government forcing developers to pay 13.5% VAT on residential property development costs whereas developers can claim back 13.5% VAT on Construction costs for office developments. We believe that given the stimulus effects of house construction across all sectors of the domestic economy, VAT should be set at a similar level to that of commercial property development. In this way the business case for the provision of cost effective housing projects in areas of greatest need, such as the Greater Dublin area, could be enhanced and development fast tracked and supported.
Conclusion
With over 60% of current expenditure allocated to the public sector and social welfare budget, savings must be found. This government cannot look at increasing employment taxes as this will hinder growth and performance. Our economy is improving month on month. This budget needs to encourage growth, needs to be pro-business and needs to send out a message that Ireland is open for Business.