Influential accounting firm PwC is pushing for a further extension of the hospitality VAT holiday until the end of 2024, with an overall cut of 21pc in VAT.
Family Business Network (FBN) co-author PwC in its pre-budget submission called for a variety of tax cuts, including measures to make heritage more attractive, which they say will help make indigenous businesses more competitive .
PwC said reducing the tax burden on private businesses will help them to help their employees withstand inflationary pressures and make them more financially sustainable.
“First, more strategic and long-term measures to encourage investment and support entrepreneurs – making Ireland an entrepreneur’s first and only option to set up a business,” said Nicola Quinn, PwC’s Director of Entrepreneurship and Private Business Practice Said the partner doing together.
“Second, several suggested measures against international standards to close the large gap for Ireland’s personal taxation rates, particularly in the areas of profit taxation and employee participation in business ownership, are intended to address that gap.” speak for.”
The submission proposes to reduce the employer’s PRSI, as well as increase the tax band and credit, as a way to insulate workers against the erosion of wages through inflation.
But PwC and FBN also want measures that directly reach the bottom line of Irish businesses.
The document outlines a proposal to keep VAT at a lower rate of 9pc for hospitality businesses, while reducing VAT from 23pc to 21pc for all companies.
The special hospitality rate was introduced in 2020 to help businesses hit hardest by the pandemic lockdown. Its retention would cost the exchequer an estimated €500m per year.
According to the most recent treasury return from May, there has been a 27 per cent increase in VAT collection as spending jumped from the reopening of all sectors of the economy.
The submission argued for relaxing the tax regime around business settlement and inheritance by reducing the tax on non-property capital gains from 33 percent to 20 percent.
PwC and FBN also called for raising the capital acquisition tax limit for inheritance from parents from €335,000 to €500,000. They want to eliminate advance taxes on transferring businesses to the next generation.