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Ireland's Small Firms Association (SFA) has said that tax reform should be a top priority for the Government in 2017.
In an end of year statement, Sue O'Neill, Chair of the SFA, said that 2016 had been a rollercoaster year for small businesses. She explained that companies had been optimistic about the economic recovery but that Brexit and wage demands have shaken confidence.
According to the SFA, 64 percent of its member companies plan to take on additional staff in 2017. It estimates that small businesses will create 20,000 jobs this year across a wide variety of sectors.
O'Neill argued that for this job creation to be realized, the Government must act. "By creating a real pro-business tax system and making sure that work always pays, employees, small businesses, and society as a whole will be better off," she stressed.
The SFA is calling for an increase to the entry point to the marginal rate of income tax. It pointed out that in Ireland, the marginal rate applies from EUR34,000 (USD35,626), whereas in the UK the top marginal rate applies from GBP150,000 (USD184,494).
The SFA said that the Government should also reduce the marginal rate, with a view to bringing it to 45 percent. It added that the Earned Income Credit for the self-employees should be fully equalized with the Pay As You Earn tax credit, and that the EUR1m limit for the Entrepreneurial Rate of capital gains tax should be increased to EUR15m.
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