ICAI: Business Expansion Scheme must continue

The Institute of Chartered Accountants in Ireland (ICAI) said that it believed that the tax findings of today’s Forfás survey on Finance and Equity for Small to Medium Enterprises proved the case for the continuation of the Business Expansion Scheme by Minister Cowen on Budget day.

"The Business Expansion Scheme, which rewards investment in Small and Medium Enterprises through granting income tax relief to the investors, is a key supplier of finance to emerging Irish industries," the ICAI said in a statement.

"One in five of the small companies surveyed used the Business Expansion Scheme to raise capital in their start-up or development phase. Most of these firms employ less than 10 people.

"The proportion of SMEs which have availed of BES has increased in recent years, and such firms are a key component of Ireland’s economic success. Unfortunately this scheme is due to terminate this month. The on the ground experience of our members who arrange much of the finance for SMEs is mirrored in this official report," said ICAI director of taxation Brian Keegan.

ICAI has asked the Minister in its pre-Budget submissions to extend the time limit on the scheme and to consider increasing the amounts which can be raised by companies by this method.