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Ibec set out recovery priorities

Tuesday, March 25 10:19:32

Employers group, Ibec, will this morning launch a major new campaign, "An Ireland that works", which sets out the business priorities for the next phase of the recovery.

It will set out the five key areas where actions is needed and where government policy is out of line with the economic needs of the country.

Specific recommendations include: increase the income entry point to the higher marginal tax rate, reduce the marginal income tax rate below 50pc, abolish the pension levy, ramp up infrastructure spend to 4pc of GDP and ensure Irish interests are protected in the international tax debate. The campaign also calls for the radical reform of public sector pensions, and a fairer more transparent system of local government charges.

Ibec Director of Business Representation Mary Rose Burke said: "Across a range of important areas the country is not working as it should and the Government needs to act. We have important choices to make on how to build on the economic progress already made, tackle unemployment and drive growth across the economy. We need to get these right."

Irish business has identified five pressing issues that will have a major impact on Ireland's future success centred on creating a better environment for jobs and business growth.

Ibec said Ireland is out of line internationally and our income tax rates, in particular, are too high. "Irish consumers deserve a break."

It added that poorly designed policy, legislation and regulation add to the cost of doing business and are an obstacle to growth and job creation.

"To meet our future economic needs, we need to spend much more on infrastructure projects, skills and education. We need to extend Ireland's global reach: International debates on tax and EU reform could have major implications for Ireland. We need to influence and shape the agenda. We need to promote enterprise and entrepreneurship: Business need to have access to effective enterprise supports, credit and export markets. Risk needs to be rewarded," it said.

On income tax Ms Burke said: "The tax system is not working for growth. The tax burden is too high and is a drag on employment, investment and consumer spending. It makes the move from welfare into work less attractive and makes it more difficult to attract mobile talent to the country. In the next budget, the Government should increase the income entry point to the higher marginal tax rate and reduce the marginal income tax rate below 50pc. The unfair pensions levy should be dropped and excessive excise increases, which have put us way out of line internationally, should be reversed."

"The global debate on corporation tax has the potential to significantly shape our prospects over the coming years. There are opportunities for Ireland, but it is vital that Irish interests are protected and advanced in debate and reform of international tax rules. This must be a key focus for government."