ISME, the small business group, has warned that this year's Budget could define the future of businesses and the attitude towards entrepreneurial endeavours that are so important in helping to drive the economy forward.
At a meeting yesterday evening with Finance Minister Brian Cowen, the group delivered its pre-Budget Submission and said that restoring competitiveness and rewarding enterprise should be key priorities in formulating Budget 2007.
The ISME submission recommends that an alternative energy policy should be introduced without delay. It says that strong incentive measures should be introduced to encourage SMEs to invest in alternative energy projects, with further incentives for investment in wind, wave and biofuel energies.
It also urges the redistribution of the 'burden' of commercial rates and water charges to other sectors, including the state and domestic households.
ISME says that with the ending of the SSIA scheme next year, the Government could switch its contribution to the scheme to spending on infrastructure projects. It also urges that all infrastructure projects should be time specific with contracts allocated on the basis that the work be completed within a timeframe that compares to international standards.
The small business group says that money invested by family members for establishing or expanding a family business should receive some form of favourable tax treatment. It wants to see the Business Expansion Scheme and the Seed Capital Scheme extended to 2013 and an increase in these schemes' ceilings to €2m per company.
ISME also suggests the introduction of a simple profit sharing scheme whereby 10% of profits annually are exempt from Corporation Tax, where they are allowed to accumulate in a fund for the benefit of employees, for at least three years.
It also calls for the reintroduction of dividend relief for owner-managers. It suggests that the first €50,000 of dividends of any company should attract the standard tax rate of 20%.
'The full implementation of the recommendations of the Small Business Forum would be a good indication that the plight of small business has been taken on board by the Government,' commented ISME Chairman Daniel Hickey after the meeting with the Finance Minister.
