Incentive to boost exports to BRICS nations welcomed

A MASSIVE boost is expected for the development of new product sales abroad by Irish companies.

The Government announced a “foreign earnings deduction” which will apply where a person spends at least 60 days a year developing markets for Ireland in Brazil, Russia, India, China and South Africa. It said this will incentivise companies to place staff overseas to encourage export sales.

Chief executive of the Irish Exporters Association, John Whelan, said this is one of the most “export promotional budgets” they have seen for decades. He added that it will go a long way to assisting exporters develop new products and sell services into rapidly growing but distant BRICS markets.

“The IEA have been lobbying for several years for a foreign earnings deduction scheme to support the export drive into the fast growing markets of Brazil, Russia, India and China and strongly welcomes the announcement in [the] budget,” he said.

The Government also reiterated its commitment to retaining the country’s attractive 12.5% corporate tax rate. Finance Minister Michael Noonan said he wanted to say to “our friends in the multinational sector” who continue to invest in Ireland, there will be no change in our corporate tax rate.

Property consultants Knight Frank Ireland said the commitment is “vital” to the continued attractiveness of Ireland to foreign direct investors.

“This has been the mainstay of the Irish market growth and is a hugely important mechanism to the continued growth of Irish exports and indigenous employment, fuelling demand for offices, industrial and manufacturing facilities.”

Partner at Grant Thornton, Peter Vale said the measures announced by Mr Noonan contain some “very innovative” provisions for the promotion of enterprise.

“Measures including the ability for companies to save on their tax bill when they focus on the export markets of the BRIC countries, is a very progressive measure and has to be welcomed,” he said.