CCAB-I Presents Irish Pre-Budget Recommendations

by Amanda Banks, Tax-News.com, London

11 November 2009

The Consultative Committee of Accountancy Bodies – Ireland (CCAB-I), which consists of The Association of Chartered Certified Accountants, The Chartered Institute of Management Accountants, and Chartered Accountants Ireland, has presented several findings in its pre-budget submission in the run up to the Irish December budget.

The main points of its pre-budget submission are as follows:

  • The top rate taxpayer cannot shoulder the full burden of the exchequer deficit. In 2007, taxpayers earning EUR100,000 would have paid 34.2% of their wages in taxes. This has risen to 39% this year. Those earning EUR120,000 have seen the proportion of their salary going to the taxman increase from 35.7% to 41.1%.
  • There should be a cap on taxpayers’ tax burden, with the cumulative total of PRSI (Pay Related Social Insurance) contributions, income tax and, if introduced, property tax, so that it does not exceed a fixed percentage of income. Any tax over that cap should be refunded.
  • The government should introduce a "remittance tax," to encourage foreign executives to move to Ireland. This would mean that executives would be taxed only on the amount of income brought into the country to live on, not their full salary.
  • A flexible tax break for R&D against all of the taxes a company might have to pay should be introduced. At present, the R&D tax credit is generally offset only against a company’s taxable profits.
  • The business expansion scheme (BES) system, which provides tax breaks for individuals investing in certain types of companies, should be enhanced.

A comprehensive analysis of the CCAB-I proposals is available on the body's website.

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