The Small Firms Association (SFA) has criticised Budget 2024 for not being ambitious enough at addressing the impacts of rising business costs.
“In a budget that recognised the changing economic outlook the Government has missed an opportunity to respond to the rising cost of doing business that entrepreneurs and small business owners are facing, driven mostly by government-imposed costs," said SFA director, David Broderick.
Minimum Wage Increase
"While the measures to support investment and growth in enterprises through an SME package is welcome, until we know the details, business owners will continue to struggle with rising labour costs, insurance rates and dealing with the twin transition of digital and climate.
“As announced today, employment costs for business owners will continue to rise next year, with the confirmation that the minimum wage will increase to €12.70 from January 2024, as part of the transition to a living wage by 2026.
"In our pre-budget submission SFA called for the introduction of transition supports for small firms who will struggle with the introduction of the living wage.
"We will continue to seek this permanent transition package.
Entrepreneur Relief
David Broderick welcomed the increase in EII relief from €250,000 to €500,000, the extended entrepreneur relief to angel investors and the modified the R&D Tax Credit.
"This will benefit eligible entrepreneurs and growing small businesses," he said.
"However, it is regrettable that the SFA’s call to make investing in a business in Ireland more attractive through a reduction in Capital Gains Tax has again been ignored.
“Reducing taxes on jobs is essential to help indigenous enterprises attract and retain staff and maintain competitiveness."
Top Rate Of Tax
The SFA also welcomed the increase in the entry point to the top rate of tax, changes to the USC rate, and the jump in the earned income tax credit to €1,875, which will benefit the self-employed.
“Small firms are the backbone of the Irish economy, employing under half the private sector," said Broderick.
"Budget 2024 doesn’t recognise the cost pressures business owners will be under next year.
"SFA, on behalf of members, will now seek clarity and a timeframe on the announced SME package, to safeguard its intended effectiveness and to ensure inclusivity of all small businesses.”
