The Small Firms Association has called on the Government to ensure that addressing business competitiveness issues is central to its budget approach.

In its budget submission the SFA said the Government should introduce a special capital gains tax rate of 10% for entrepreneurs, which it believes would encourage business owners who sell their companies to invest in another firm.

SFA Chairman AJ Noonan said: “It is vital that this applies to all businesses so that the impact can be felt immediately.

“Practice over the last 20 years has shown that when the CGT rate drops, the Exchequer benefits due to a surge in activity, so this is a clear win-win.”

The current capital gains tax rate is 33%.

The association also recommends other tax changes, including abolishing the 3% USC surcharge and introducing a voluntary PRSE system for the self-employed.

Mr Noonan said: “Competitiveness must be at the heart of Budget 2017. In an environment where many factors are outside of our domestic control, the Government must relentlessly pursue improvements in the competitiveness of those areas it can influence.

“This is especially critical in light of aggressive competition from the UK in the aftermath of the Brexit vote.”
The SFA also wants the Government to invest heavily in infrastructural project that would support smaller businesses.

It highlighted broadband (particularly in rural areas), public transport links, housing, and employee training as areas where substantial investment is needed.