Despite serious criticism of the government decision to reinstate a 13.5% VAT rate for the hospitality sector, an Offaly based tax expert has said Budget 2019 was largely positive for businesses.
Suzanne O’Neill is Partner at RSM Ireland, and an FCCA and a Chartered Tax Advisor. Suzanne manages the RSM Midlands office in Birr, offering a wide range of professional services to clients throughout Ireland and abroad. She has given us her reaction to Budget 2019.
"Budget 2019 was delivered by Minister for Finance Paschal Donohoe TD in a very different landscape from his predecessor ten years ago, with strong economic growth and a low level of unemployment despite the uncertainty which he referred to throughout his budget speech," Suzanne said.
"Even in our thriving economy, there was significant pressure on Minister Donohoe to increase spending on the critical
areas of housing and health. As a result, a small but helpful number of measures have been introduced to support the business community."
"For SMEs and agri-producers in Offaly facing potentially challenging times ahead as Brexit impacts, the measures announced will assist in the form of a low-cost loans (Future Growth Loan Scheme) with a scheme valued at €300m and Brexit supports across department of €110m," Suzanne explained.
"An enhanced employee share scheme for SME employees will also play a key role in incentivising staff and helping
to secure the long-term viability of business."
"Start-up companies will also benefit from the three-year ‘start-up relief’ from corporation tax, which will be extended for a further three years to the end of 2021. For local businesses growing and seeking investment, the Employment and Investment Incentive Scheme (EII) tax relief schemes can be a valuable source of funding."
She went on to say, "shortcomings were identified in the current scheme which the Minister says will be taken on board and new measures put forward in the Finance Bill. Crowdfunding will be regularised, and measures put forward as a source of funds for businesses."
Addressing the hospitality VAT hike, Suanne said, "while the increase in the Special 9% VAT rate will not be welcomed by the hospitality sector, the restoration of the full VAT rate was deemed appropriate by Government. For individual businesses
to adapt to the higher rate they must innovate and provide value-added experiences to customers."
"The SME sector is thriving in Offaly with a high-quality transport network and ease of distribution and access to markets. Measures announced in this budget should contribute to the continued growth and help safeguard businesses against the inevitable challenges of Brexit," O’ Neill concluded.