Retailers call for Budget tax cuts

Retail Ireland has called on the Government to cut taxes in an effort to boost domestic spending and spur economic growth, in its pre-budget submission.

The lobby group, which is part of Ibec, has also called on the Government to freeze or reduce consumer taxes; incentivise retailer investment in town centres and encourage use of vacant outlets; impose no new costs on retailers and make it cost-effective for retailers to hire new staff by reversing last year’s changes to employers’ PRSI.

“Sales have grown every month this year, but the retail recovery shouldn’t be taken for granted. Tax cuts will boost disposable income and increase spending in the domestic economy. This will translate into thousands of new retail jobs,” said Retail Ireland chairman, Frank Gleeson.

If the nascent recovery in consumer spending is maintained, then this would lead to an increase of 1.9% and 2.9% next year. Moreover, an improvement in consumer sentiment would cause consumers to save less. The savings rate, which peaked at 16.1% in 2009 is now falling back to a more normal level of 8%.

“Retail was on the very sharp end of the recession. 50,000 jobs were lost and many businesses closed. Despite this the sector remains Ireland’s largest and most geographically diverse. Now is a critical time for retail, with intense competition keeping prices down, the decisions on budget day must ensure the recovery continues and gathers pace.”