En­ter­prise Ire­land chief says UK bet­ter for star­tups

Irish Independent - Business Week - - FRONT PAGE - Gavin McLough­lin

IRE­LAND has fallen be­hind the UK when it comes to cre­at­ing an at­trac­tive tax en­vi­ron­ment for start­ing a busi­ness, ac­cord­ing to En­ter­prise Ire­land CEO Julie Sin­na­mon.

Ms Sin­na­mon – head of the state agency tasked with de­vel­op­ing Ir­ish busi­nesses – said the UK has a “more at­trac­tive pack­age of in­cen­tives” than Ire­land, adding that a strong of­fer­ing in this area would help “fur­ther ac­cel­er­ate the growth of Ir­ish com­pa­nies”.

She said she recog­nised the Gov­ern­ment’s in­tent to make changes in this area, in­clud­ing a plan to boost cap­i­tal gains tax relief for en­trepreneurs by in­creas­ing the amount of gains that would be taxed at a re­duced rate.

The cap­i­tal gains tax regime is one of the ar­eas that have re­ceived crit­i­cism from en­trepreneurs, along­side the tax treat­ment of share op­tions. A new regime for cer­tain share op­tion schemes was in­tro­duced in last year’s bud­get, but was crit­i­cised as overly re­stric­tive and then tweaked in this year’s bud­get af­ter a low level of take-up.

The de­vel­op­ment of Ir­ish firms is in­creas­ingly in the spot­light amid in­creased threats to our FDI regime, rang­ing from multi­na­tional tax re­form, to US Pres­i­dent Don­ald Trump’s over­haul of the US tax code aimed at bring­ing busi­ness back to that coun­try.

“We have long said that the em­pha­sis on for­eign di­rect in­vest­ment in Ire­land is too great. We have long called out the univer­sal po­lit­i­cal fail­ure to em­brace the con­tri­bu­tion that small en­ter­prise makes to Ire­land. We have long said that fo­cus is re­quired on in­dige­nous en­ter­prise,” said Ciaran Murtagh, chair­man of the Ir­ish Small and Medium En­ter­prises As­so­ci­a­tion at its an­nual con­fer­ence yes­ter­day. “We need to ac­cept that the way we’ve man­aged in­dus­trial pol­icy since the TK Whi­taker era has to change, and we need to pivot in­dus­trial pol­icy to­wards in­dige­nous en­ter­prise,” he added.

Ear­lier this week, the Na­tional Com­pet­i­tive­ness Coun­cil (NCC) warned that most Ir­ish firms are see­ing their pro­duc­tiv­ity shrink, with a small num­ber of big com­pa­nies, work­ing in largely for­eign-dom­i­nated sec­tors, mask­ing the un­der­per­for­mance of smaller com­pa­nies who ac­count for most of the em­ploy­ment in the State. The NCC said a “ma­jor ef­fort” was needed to help Ir­ish busi­nesses in­vest in in­no­va­tion.

En­ter­prise Ire­land CEO Julie Sin­na­mon

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