BUDGET 2016: Vibrant enterprise sector vital to our economic wellbeing
From my perspective, the key thing in this budget is to make sure that the measures undertaken help underpin this economic success further, which I believe they do.
A strong vibrant enterprise sector, including a large foreign direct investment segment, is vital to our economic wellbeing. It is the enterprise sector that provides the fiscal wherewithal to do the other things that are required in areas like education, health, and social protection.
That FDI segment of the economy is currently in good health with total employment approaching 175,000 people in terms of direct employees and over 120,000 additional jobs dependent on the FDI sector.
The international competition for FDI is intense so there is no room for complacency. All projects won for Ireland are hard won.
We need to ensure that Ireland remains competitive for all aspects of the proposition — talent, infrastructure, regulation, and tax — corporate and personal.
Yesterday’s budget continues efforts to improve the pro-business environment and build on last year’s positive announcements.
Among the most notable measures announced by Minister Michael Noonan is a “best-in-class” knowledge development box (KDB), aimed at encouraging innovation and research out of Ireland.
This KDB will see a lower tax rate applied to profits from IP that were generated as a result of R&D undertaken in Ireland.
The rate of 6.25% that has been announced is competitive and I believe will it help to attract new R&D to Ireland.
Even more important is the fact that it is the first knowledge (or patent box) box in the world that is compliant with OECD guidelines, which will provide certainty to investors in their long-term planning.
Other measures contained in the budget in relation to entrepreneurship and further progress in reducing personal income tax rates are also welcome in creating a pro-business ecosystem.
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