A reduction in capital gains tax, the permanent introduction of a 9 per cent VAT rate for the hospitality sector, and a new State agency to grow indigenous businesses are among the measures sought to support small and medium-sized companies here.
Professional services company Azets Ireland has called on the Government to implement measures to support small and medium-sized businesses in the Irish economy, stating that the uncertain economic environment could pose a risk to thousands of jobs.
In its pre-budget submission, the group said SMEs account for about two-thirds of the State’s workforce. However, Azets warned, they can be disproportionately affected by economic difficulties.
“The SMEs keep the lights on in good times and in bad times. It’s the owner-manager businesses, which is ordinary people getting up every day doing extraordinary things and putting huge work into just keeping the lights on in the economy,” said Neil Hughes, chief executive of Azets Ireland.
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The firm is seeking a reduction to 20 per cent in capital gains tax, down from the current 33 per cent, saying it could encourage investment in indigenous businesses and support succession planning.
It wants the Government to reintroduce the 9 per cent VAT rate for the hospitality sector from January 1st.
The proposed State agency, Elevate Ireland, would support growing indigenous businesses, helping them to compete at a global level.
Among the other measures proposed are the introduction of a 30 per cent tax credit for mid-sized businesses investing in AI and digitisation, the ring-fencing of €200 million in funding from the National Training Fund for AI skilling and training, and the establishment of a €500 million SME export resilience fund to help off-set the impact of trade tariffs and support the move into more diverse markets.
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“Establishing a new state agency for indigenous non-exporting businesses, supporting AI and digital investment, and creating mechanisms like an SME export resilience fund or a Rural Employment Grant would equip these businesses to thrive despite the current economic pressures,” Mr Hughes said.
Azets also asked the Government to consider deferring planned increases in employee statutory sick leave and additional entitlements to 2027, saying companies were facing rising costs of doing business.
“We think that the Government has to take specific and more dramatic actions in terms of assisting businesses,” Mr Hughes said.
