25 schemes announced in bid to tackle jobs crisis

The Government placed jobs at the centre of its budget speeches, announcing 25 schemes ranging from tax reliefs to targeting the black economy.

Finance Minister Micheal Noonan has earmarked €500m for the ‘build your own business’ package designed to help small businesses and entrepreneurs.

Mr Noonan is hoping the scheme will tempt some of the long-term unemployed into setting up their own businesses.

The scheme will allow anybody who has been out of work for 15 months to set up a new company and be exempt from income tax of up to €40,000 a year.

Mr Noonan said he hoped the scheme would attract construction workers looking to capitalise on the home improvement scheme. It is not limited to just that industry.

Separately, entrepreneurs who reinvest in new businesses are to be given a special low rate of capital gains tax of 16.5%, instead of 33%. It applies if they put any windfall from selling a business in to a new enterprise.

The measure is designed to provide start-ups with a new source of finance as the banking sector remains unwilling to lend.

A further measure announced yesterday in a bid to increase investment in SMEs was the removal of the 30% relief for high-net-worth investors under the employment and investment incentive.

The incentive provides that a maximum of €150,000 can be invested by an individual without fear of the 30% relief.

It is hoped that more investors will be encouraged to look to Irish SMEs.

Investors are also to be lured to Irish companies through the stock exchange. The removal of the stamp duty charge (currently 1%) on shares listed on the Enterprise Securities Market is designed to help early-stage Irish companies raise capital.

To aid SMEs bidding to access finance, an increase in threshold for applications that can be reviewed by the Credit Review Office was introduced, rising from €500,000 to €3m.

Real estate investment trusts will be included in the Immigrant Investment Programme, which provides permanent residency for any individual who invests more than €1m in Ireland over three years.

The Government also announced that it is working with the European Investment Bank to provide funding to Irish exporters.

A communications strategy for SMEs will be introduced across State bodies.

In tandem with the communication strategy is a training programme lasting two days that would aim to help SMEs increase their financial capacity.

Three separate measures to encourage innovation were announced, including a tax credit for outsourcing, which is aimed at smaller SMEs.

A base year tax credit for companies which have spent considerable sums on R&D was introduced along with a key employee tax provision to help companies attract top talent.

A crackdown on the black market was promised, targeting companies which have not paid tax in six months or which failed to keep specific records.