BUDGET 2016: ‘Little to allay concerns of small business’

Despite saving shop owners around €36m in annual fees by halving the costs they must pay on accepting card payments and introducing a tax credit for the self-employed, the Government has been criticised for not going far enough to ease the cost burden on the retail sector.

“The reality on the ground is that many of the country’s small businesses continue to struggle with the legacy impacts of the recession,” said Peter Steemers of the National Federation of Retail Newsagents.

“The new measures have resulted in the Government giving with one hand, with tax credits for the self-employed, and taking with the other hand, by increasing the minimum wage and adding 50c to the price of cigarettes.”

He added: “While the introduction of a new €550 tax credit for the self-employed and bringing debit card fees into line with European norms are very welcome, the budget has done little to allay the concerns of small business owners about where the Government’s priorities lie.”

While welcoming income tax cuts that should boost consumer confidence ahead of Christmas, Retail Ireland chief Thomas Burke said it was disappointing the minimum wage has been increased without meaningful measures to offset costs.

“The minimum wage increase is premature and will disproportionately impact the retail sector, where labour costs make up a large proportion of the cost base. The reduction in employer’s PRSI, aimed at offsetting the cost for employers, is simply not enough to encourage the creation of new jobs,” he said.

Mr Burke said retailers are concerned about the 50c hike in excise on cigarettes. “At a time when black market activity continues to pose a significant threat to legitimate retailers, such an increase without any further deterrent measures will only continue to incentivise such activity.”

Tara Buckley of the Retail, Grocery, Dairy, and Allied Trades Association, said: “It is regrettable that the budget hasn’t addressed the need for specific tax initiatives to assist the regeneration of rural towns and villages.”

One retailer, Paul Kealy — who runs Tony Kealy’s, the country’s largest independent nursery retailer — was pleased, however.

“Overall, I’m happy with the budget. I think the reduction in USC is very positive, as it puts money back in people’s pockets. Likewise, the reduction in employer’s PRSI for low-paid workers will help offset the increasing costs of employment following the announcement of the increase in the national minimum wage.”