Irish Accountants Criticize New Finance Bill

by Robert Lee, Tax-News.com, London

26 November 2008

The Irish Institute of Chartered Accounts (ICAI) has expressed disappointment at the recently published finance bill, arguing that the initiatives which have been set out to give a ‘prosperous’ future for Ireland are not worth the consequences in the short-term.

According to the ICAI, while the 2008 finance bill, published last week, does contain worthwhile enhancements to research and development, the Business Expansion Scheme (BES) and the Irish double taxation network, they believe that it is unlikely to have much impact in the short-term.

The ICAI has expressed concern that the stimulus measures in the bill are not reflective of the severity of the economic situation. They also believe some tax exemptions, more specifically those for small start-up companies, while welcomed, may not be sufficient to encourage growth.

Brian Keegan, Director of Taxation at the ICAI said:

“The focus of this bill was to be one of ‘support for the enterprise sector by enhancing the knowledge economy’. However this message gets lost in the realities of accelerated tax costs, most notably a new corporation tax payment regime with its harshest cashflow implication arising in 2009."

“The car parking space levy looks increasingly like a negative tax – one which could cost more to administer than it will yield. As such it could be assumed that it is the first phase of a developing measure intended to combat congestion. It is extremely important that the enforcement of the parking space levy be deferred until mid 2009 – no employer can reasonably be expected to have payroll systems in place to collect any new levy with this complexity from January 1."

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