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SFA wants capital gains tax slashed to 20%
Sven Spollen-Behrens

03 Sep 2020 / business Print

SFA wants capital gains tax slashed to 20%

The Small Firms Association (SFA) Budget 2021 submission calls for backing for Ireland’s small businesses and entrepreneurs, so that they can get to the other side of the ongoing health crisis and prepare for a post-Brexit environment.  

Director Sven Spollen-Behrens said this morning (3 September): “In light of continuing restrictions imposed on small businesses across the country, it is vital that the Government use Budget 2021 to focus on providing certainty on costs and debt forgiveness, and support the retention of staff, to help small businesses survive and mitigate any long-term impacts from COVID-19 restrictions.  

Barriers

“Given the all-consuming nature of COVID-19, Ireland’s economy can no longer accommodate the long-standing barriers facing business-owners. Budget 2021 must take decisive action to stop the discrimination in the tax system against the self-employed and proprietary directors.

“To assist the recovery and make Ireland a better country for entrepreneurship, capital-gains tax should be reduced from the current penal rate of 33% to 20%, and the Earned Income Tax Credit increased to €1,650. 

“Addressing barriers and disincentives for entrepreneurs and business is equally important in the context of Brexit, the impact of which is already being felt by small businesses and regions most reliant on Brexit-exposed sectors,” he said.

The SFA submission sets out the following priorities: 

  • Protect the business environment for small firms and entrepreneurs, 
  • Prepare for a ‘no-trade deal’ Brexit, 
  • Sustain investment and entrepreneurship through the tax system, 
  • Support employment and upskilling in small firms, and
  • Incentivise small firms to transition to a low-carbon economy. 

The Programme for Government commits to the establishment of an SME growth taskforce to design a national SME growth plan, the SFA points out.

“Government must deliver on this commitment and introduce a plan that does not just undo the damage inflicted by COVID-19, but will unlock economic capacity, fuel job creation, promote new business investment, and be environmentally responsible. 

Job activation

“This budget must take steps to meet the challenges and opportunities of the digital economy and boost employability, by investing in reskilling, upskilling and job activation schemes to get people back to work. It must also safeguard the delivery of decent, affordable broadband to small firms across the country,“ the SFA says.

Mr Spollen-Behrens concluded: “Small businesses were major contributors to growth, job creation and regional economic recovery after the 2008 economic crisis, and will be again, if the right choices are made in Budget 2021.” 

Gazette Desk
Gazette.ie is the daily legal news site of the Law Society of Ireland