Morning business news - October 16Wednesday 16 October 2013 10.32
The Irish Tax Institute is hosting a post-Budget breakfast in Dublin city centre this morning to chew over over the decisions made in yesterday's budget by Ministers Michael Noonan and Brendan Howlin.
Helen O'Sullivan, President of the Irish Tax Institute, welcomes the fact that there were no income tax or universal social charge increases in yesterday's Budget, adding that this will increase consumers' confidence on spending as their take-home pay is not cut. She says it should also lead up a strong Christmas spend, which will boost retail sales and therefore the economy. The retention of the 9% tourism VAT rate will also have a positive impact on the domestic and local economy, she adds.
Ms O'Sullivan says the news that the Government plans to shut a tax arrangement used by Apple - and a small number of other companies - to shelter $40 billion from taxation is also a positive move by Mr Noonan. She says that companies want to feel secure in the countries in which they operate and Mr Noonan wants to keep them here. Mr Noonan told the Dail yesterday that he wants Ireland to "play fair but to play to win", and the tax expert says that from now on, companies will know where they stand with regards to tax rules. They will be given 15 months to adapt to the new changes which will be contained in the Finance Bill next week.
Entrepreneur and chairman of Forfás, Eoin O'Driscoll, welcomes the commitment to the country's 12.5% corporation tax rate. He says that Ireland must remain competitive on business taxes, but the Government knows that reputation is key in attracting multinationals to set up - and retain - jobs here. Mr O'Driscoll says he believes that multinationals will be reassured by Mr Noonan's Budget statement yesterday, adding that it has also been welcomed in the US by the two senators who had labelled Ireland as a tax haven.
Mr O'Driscoll says the Budget was directionally correct for Irish businesses and very positive. The capital gains tax relief roll-over move was very positive, while the Forás chairman also welcomed the retention of the 9% VAT rate. He also says that Budget 2014 was positive in terms of growing new businesses and starting new businesses and welcomed the fact that it does not add to the payroll taxes. But he cautions that we may be getting ahead of ourselves, adding that there is still some balancing of the books to be done.