Entrepreneurs supported, not strangled, by FF taxation policy.
Fianna Fáil recently published its policy on taxation reform and I believe FF’s taxation proposal is far more progressive and encouraging to budding entrepreneurs than Fine Gael’s complicated and less than inspiring strategy on Capital Gains Tax.
The business sector scoffed FG’s derisory €1m Capital Gains Tax exemption for Entrepreneurs. If you were an entrepreneur who had successfully grown and then sell on your company, €1m would not even make a dint in the CGT you would have to pay. In short, FF looks to an improving economy and seeks to support and encourage Ireland’s budding entrepreneurs, along with seeking to retain jobs created.
FG’s policy saw CGT increased to 33 per cent whilst FF will lower to 25 per cent, thereby proposing a sustainable, costed and attractive tax reform to support the best entrepreneurs in Ireland, thereby supporting our job makers and creating further employment opportunities.
FFs proposals of a flat 10 per cent on the first €15m will simplify and offer much more attractive tax relief to our business community. My party colleague Deputy Michael McGrath has also committed FF to introducing a best in class capital gains tax regime.
“The extension of Capital Gains Tax relief in Budget 2016 was restricted to the first €1m of gains. It remains an extremely complicated system. In contrast, the UK has a simpler, clearer and more attractive relief which applies a flat 10% rate to entrepreneurial gains of up to Stg £10m. This limit has increased three fold since the relief was introduced.
A bold policy measure in relation to capital gains tax does not pose a significant risk to the public finances. The Department of Finance has provided ‘We will also cut the main capital gains tax rate to 25% as resources allow’. This would cost €168m in a full year. In reality, the actual loss of revenue would be far less and in turn, FF’s flat rate of up to €15m will generate economic activity and raise overall revenue with an estimate that this would cost €74 m in a full year and we will fully provide for this in our manifesto”.
On the personal tax level, FF proposes a USC 1% rate abolition, a much better option for lower income workers.