‘Immense’ boost for employers

The effect of halving of the lower rate of employer PRSI will be “immense”, a Clare business organisation claimed this week.
“The reduction in the lower rate of PRSI is welcome, particularly at entry level for employers to employ more people. The net effect of having someone in employment even at the lower rate for the local economy is immense.
“You have someone who is not on the dole, who has spending power, who has security and who has confidence. The knock-on effect is that there is a feel-good factor in creating employment and announcing jobs and that has its own effect in generating consumer confidence in the economy,” Rita McInerney, CEO of Ennis Chamber, told The Clare Champion.
Ms McInerney also welcomed the retention of the 12.5% corporation tax rate, saying that the impact of foreign direct investment is felt across the whole economy.
“The commitment to the 12.5% corporation tax rate is to be welcomed because in order to incentivise foreign direct investment and maintain the multinationals we have, we need to continue to provide that level of corporation tax.
“There is a huge spin-off from multinationals and through the people they employ spending in the local economy.
“People argue that these profits are going abroad but multinationals are a significant employer and this means more people can spend money in the local economy.
“It is a dual process. Small businesses need to be supported in conjunction with this corporation tax level and we can have a dual employment strategy that includes this type of encouragement to multinationals as well as supporting indigenous employment,” Ms McInerney claimed. 
The Minister for Finance’s announcement that he intends to continue to enhance the attractiveness of the research and development Tax Credit Scheme was also endorsed by the chamber.
“In relation to research and ­development, there has been investment and there is a tax credit there for those who wish to avail of it and that has been maintained and extended.
“As a small economy, we have to have the opportunity to be world leaders in innovation and research and development is an important element of that,” Ms McInerney continued.
Overall, Ms McInerney described the initiative as “positive” but added that “I was a bit disappointed that there wasn’t more about a reduction of costs and red tape and bureaucracy for small businesses. That would be one area I would like to see dealt with. For businesses dealing with different organisations, like Revenue or the National Employment Rights Authority in terms of compliance, there needs to be a simplification of processes in setting up and maintaining standards. Often, there is not enough sharing of information between agencies.
Each business should nearly have its own government file with regard to what they have to do to be in business rather than dealing with lots of departments and agencies, because there is just so much red tape involved.”