Budget 2017 was announced by the Minister for Finance, Mr Michael Noonan, earlier today.
Cahill Taxation’s tax experts have analysed the details in Budget 2017 and we invite you to share our perspective on the Budget by reviewing our newsletter.
While there is no doubt that, in recent years, Ireland is operating in significantly improved times economically, 2016 has been a somewhat tumultuous year on the economic front. The Budget is therefore cautious and conservative in content which is what was expected in the first Budget of the minority government operating within a limited fiscal space.
The uncertainties presented by Brexit and the publication of the negative EU State Aid ruling on Apple’s tax structure in Ireland were no doubt to the forefront of the Minister’s thoughts when drafting the Budget.
The Budget in particular focussed on a number of key areas including:
- The Budget presented a number of measures aimed at supporting the housing market including the “Help-to-Buy” scheme for first time buyers and the partial removal of interest relief restrictions for residential landlords.
- The Government introduced measures aimed at encouraging entrepreneurship in Ireland through the enhancement of the Capital Gains Tax Relief for entrepreneurs and an increase of €400 to the tax credit for the self-employed. However, there is a significant amount to be done in this area before Ireland can be considered a “go-to” place for budding entrepreneurs.
- The Budget introduced measures aimed at supporting the rural economy with reliefs for the agricultural sector in particular. However, the measures are likely to have limited impact and will do little to encourage businesses to set up in rural Ireland.
As is the norm on Budget Day, the Minister used his speech to reiterate the long-term intention to maintain the 12.5% corporation tax rate. However, the Government has importantly signalled a review of our corporate tax system with an assessment of its impact on investment. Such a review is to be welcomed, particularly in times when our corporate tax regime is under much scrutiny internationally.
Apart from minor changes to USC and tax credits, no material changes were made to our personal tax rates. The entry level to the top rate of income tax in Ireland remains at a comparatively low €33,800 when compared with other OECD countries.
There is much work to be done in the area of personal taxes and this area should become a key priority of the Government in the years ahead to ensure that Ireland remains an attractive country to work and live in.
If you have any questions on what Budget 2017 means for you or your business, please feel free to contact a member of the Cahill Taxation team.
To view the slides from our Budget 2017 Breakfast Briefing please click here.