As the Budget announcement approaches, conversation has turned largely to conjecture over what changes may be made to safeguard against Brexit related issues. As you will all be aware, we here at EcovisDCA are massive supporters of Small and Medium Enterprises (SMEs). These vital businesses are enormously important to Irish business in general and due to their size are vulnerable during this uncertain time.
Recently Dublin Chamber Chief Executive Mary Rose Burke spoke out about the importance of safeguarding these businesses and enabling them to not only survive but to thrive in a post-Brexit world and suggested that Burget 2020 must endeavour to help SMEs to compete with larger, more economically attractive companies. In order to face Brexit head on, Burke suggests that Capital Gains Tax may be the first port of call as the current set up of an overall 33% rate is damaging to small companies and favours attracting larger companies. It is suggested that this be reduced to 20% for all unlisted trading firms and should take into account the level of risk taken by entrepreneurs in order to protect these important business owners.
“We need to foster an entrepreneurial environment and strengthen Ireland’s indigenous business base.”
Given that SMEs form over half of all Irish business operations, it would be wise to begin investing heavily in the entrepreneurial spirit that exists in our country. The Dublin Chamber has stated that the UK is ahead of Ireland in terms of supporting Irish SMEs, and proposes that we follow suit. The current taxation system which applies across the board actively encourages investment in larger multinationals over SMEs. As these large companies are such a small fraction, it is easy to see how smaller businesses may suffer further blows following Brexit, as Burke suggests;
“[Large multinationals] are already more attractive for entrepreneurs. We need to look to improve our competitiveness in ways that are under our control. […] with Brexit on the horixon, it is vital that we react and fight back.”
There is a concern that if changes are not made in the coming Budget, the UK may eclipse our small island in terms of attractiveness to foreign trade which could see significant damage dealt to our economy. As such a long term plan in the coming Budget would be a welcome safety net for Irish SMEs
As always, we will be reporting on this year’s budget as it happens and keeping you up to date on what these changes will mean for you and your business. Should you have any concerns or queries on any business or financial issues, please don’t hesitate to contact us here at EcovisDCA where we are always happy to assist.