The Small Firms Association (SFA) yesterday welcomed the increase in the Earned Income Tax Credit announced as part of Budget 2019 but expressed disappointment with the missed opportunity to relieve business costs on small firms as Brexit approaches.
The SFA say it is regrettable that the Government has again ignored the Association’s call to reduce Capital Gains Tax (CGT), to 20% across the board, to make investing in a business in Ireland more attractive. At 33%, Ireland has one of the highest rates of CGT amongst developed economies. The SFA is also calling for CGT Entrepreneur Relief to be extended to compete with the UK scheme.
The Association say Budget 2019 will further increase business costs for small businesses with the decisions to raise the National Training Fund levy and to increase the special 9% VAT rate which previously supported the tourism industry. With the continuing uncertainty of Brexit, SFA say it is very discouraging that government continues to play a significant role in "driving business costs upwards."
Speaking yesterday, SFA Director, Sven Spollen-Behrens said, "The Earned Income Tax Credit (EITC) for the self-employed has come closer to parity with the PAYE Tax Credit, with today’s announcement of an increase of €200 to €1350. However, the blatant discrimination that was due to end in Budget 2018 has still not come to fruition; the SFA will continue to campaign for the gap between EITC, and the PAYE Credit (€1650) to close fully in next year’s Budget."