Accountants hit out at tax-break consultations
Umbrella group wants to make sure Finance listening to feedback, writes Samantha McCaughren
Accountants have expressed frustration with the Department of Finance over an apparent lack of consideration given to responses to consultations on tax breaks.
The department has held a series of consultations in recent years on tax incentives such as the Employment and Investment Incentive (EII) scheme, but umbrella group the Consultative Committee of Accountancy Bodies - Ireland (CCAB-I) said it needed some evidence that its views were being taken into consideration.
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The department is currently reviewing several incentives including Capital Gains Tax (CGT) for entrepreneurs, the Key Employee Engagement Programme (Keep) and the EII Scheme.
"CCAB-I believes that in order to secure proper engagement with the consultative process, respondents need tangible evidence that the comments and suggestions provided are being listened to and are considered in the process of making policymaker decisions," said the umbrella group's submission.
"Over the past five years, there have been several public consultations on the role of the tax system in encouraging entrepreneurism and supporting Ireland's SME sector." It suggested the introduction of a code of consultation principles, similar to that in the UK, whereby notes on the balance of considerations on tax relief decisions are published. "It would be useful to better understand the basis for policymakers' choices in decisions taken as part of these regular review processes of reliefs."
CCAB-I said it "looks forward to active engagement by policymakers in these important consultations on incentives to support business growth by SMEs in Ireland."
With regard to Capital Gains Tax, CCAB-I recommends that the lifetime cap of qualifying gains should be increased from €1m to €10m.
The body said it has raised concerns about the EII scheme for several years.
The submission said that EII needs to meet a gap in the access to finance for early-stage companies and for SMEs that are seeking to raise equity capital for major expansions in their business.
"The broader challenges of accessing finance across the SME sector are even more acutely faced by early stage companies or those seeking to raise equity capital for significant new expansion," said the submission.
But it has concerns about the complexity of the "conditions underpinning the legislation and the restrictions which block access to these reliefs in the first place for many SMEs that are in critical need of funding".
The Department of Finance ran an open consultation forum on these topics last week.
Sunday Indo Business