Dáil Éireann Debate, Wednesday - 25 October 2023
82. Deputy Fergus O'Dowd asked the Minister for Enterprise, Trade and Employment if he will respond to concerns and proposals raised in correspondence (details supplied); and if he will make a statement on the matter. [46882/23]
View answerThe introduction of a temporary abolition of Pay Related Social Insurance (PRSI) for lower earning workers in 2024, 2025, and 2026 is a matter for the Minister for Social Protection. The Commission on Taxation and Welfare recommendations point to the importance of broadening the PRSI base as important in order to enhance the Social Insurance Fund.
This has been a challenging year for firms as they grapple with the effects of inflation and the aftermath of the COVID-19 pandemic. As a small, open trading economy Ireland is exposed to global inflationary pressures, including fluctuations on international markets for energy, commodities and food. Ireland is effectively a price taker on most international markets, and many of the drivers of Irish inflation are outside our control. Our remote geographic location can also add to transport costs for goods, which along with our small market size, can add to costs for businesses.
Although the Government cannot fully insulate individuals and businesses from developments in international markets that are outside of our control, we have been proactive in putting in place measures to remedy the fallout from higher rates of inflation. The Government is committed to supporting enterprise. Under Budget 2023 the Government allocated €1.3 billion to the Temporary Business Energy Support Scheme (TBESS) to reduce energy costs to business. Budget 2024 has continued this supportive approach. Among the measures included, are:
• The 9% VAT reduction for gas and electricity is being extended for an additional 12 months, until 31st October 2024;
• The temporary excise rate reductions applying to auto diesel, petrol and marked gas oil which were due to expire on 31st October 2023 are being extended until 31st March 2024;
• An increase in the limit on the amount that an investor can claim relief on under the Employment and Investment Incentive Scheme, to €500,000;
• An increase in VAT registration thresholds for SMEs to €40,000 for services and €80,000 for goods;
• Reduced Capital Gains Tax rate of 16% for Angel Investors in innovative SMEs, on gains of up to €3 million;
• An increase in the R&D tax credit from 25% to 30%, as well as increasing the first-year upfront payment from €25,000 to €50,000, which will be of particular benefit to SMEs;
• The commencement of a range of amendments to the Key Employee Engagement Programme for the attraction and retention of staff;
• Introduction of the Increased Cost of Business Scheme, which will provide a once-off grant to benefit a significant number of small and medium businesses at a cost of €250 million.
