Budget 17 with PwC

Join us over the coming weeks as our experts share their insights on the challenges and opportunities for the economy and how Government can create a roadmap for progress and prosperity.

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As our economy continues to recover, the Government finds itself in a more favourable fiscal position in the lead up to Budget day than in recent years. While delivering a Budget during a period of recovery and increasing prosperity is preferable to the alternative, it does pose a challenging exercise.  

Against the backdrop of Brexit and changes in the global tax environment, how can Government balance competing demands and deliver a Budget that provides a path to sustained progress and prosperity?
Our coverage in the coming weeks will reflect on the challenges and opportunities in the current environment, nationally and globally, and on how the provisions introduced on October 11 will affect you and your business.


Foreign Direct Investment

After the drama of the Apple decision, the coming months offer a chance to regain perspective on the corporate tax agenda. It is also an opportunity for Government to reduce the tax burden for employees.
We look forward to the reiteration of the Government’s commitment to the cornerstones of Ireland’s corporation tax policy, such as a transparent regime that includes the 12.5% rate and the R&D Tax Credit. It is also an opportunity to reframe the Irish system in the context of international tax reform. This means continuing consultation with the FDI community on the implementation of EU/OECD measures; the renegotiation of the US/Ireland Double Tax Agreement; and the resourcing model that Revenue will need in the new environment.
Measures that reduce the tax burden on labour are needed. The lowering of personal tax rates would be advantageous to the existing workforce and in attracting and retaining key staff here.
Join us as we take a closer look at these issues.

Financial Services

Financial Services in Ireland could benefit significantly from Brexit, and Budget 17 is the perfect opportunity for Government to clear the path to a new phase of growth for the sector.
Many UK-based FS operations are developing contingency plans to deal with the possibility that the UK does not maintain full passporting rights. Those plans include the option of setting up a new entity elsewhere in the EU, and Dublin is competing with other European cities for this business. We feel that Government could help the FS sector by addressing the perceived blocks to attracting businesses which may be looking to move out of the UK.
Positive measures would include revision of the high rates of personal tax and thresholds for paying income tax at the marginal rate, which continue to be significant issues in attracting talent to Ireland; the allocation of additional budgetary resources to ensure the CBI has the capacity to deal with a significant influx of new entrants to the Irish FS sector; and the promotion of investment to deal with the lack of capacity in the residential and commercial infrastructure.
Join us as we take a closer look at these issues.

Private Irish Business

Ireland’s economy is growing, but is being influenced by external factors such as Brexit and changes in the global tax landscape. Budget 17 provides a good opportunity for Government to nurture our domestic economy.
We hope to see Entrepreneur relief changes to make the regime more competitive with its UK equivalent. In order to continue growth in our economy and to encourage SMEs to put money back into business, a reduction in the level of employer PRSI would be a welcome improvement.
This will have the knock-on effect of increasing employment, as more resources are needed to operate growing businesses. In order for SMEs to retain these new employees, changes are needed in the taxation of share options and other employee equity incentives to make non-cash remuneration more accessible in the SME space.
Join us as we take a closer look at these and other relevant issues.

Irish PLCs

The international tax policy landscape is evolving at a faster rate than anyone could have imagined a few years ago. The ongoing BEPS project has been quickly followed by the EU’s anti-tax avoidance directive and State Aid decisions. These items have brought an increased focus on Ireland’s tax system, with calls for amendments to various provisions and rumours circulating about what might happen and when.
The current environment offers the Minister for Finance an excellent opportunity to reaffirm Ireland’s commitment to a competitive tax offering for Irish domestic companies. We do not expect any major corporate tax changes that would have an immediate impact on the Irish PLC community, but policy statements could provide some clarity on how Ireland is going to navigate the tax landscape in the medium term.
Join us as we take a closer look at these issues in the coming weeks.

Easing the tax burden is a gateway to growth

PwC tax partner Mary Honahan reflects on the measures that would make the personal tax system more robust and beneficial for everyone involved.

Was the balance right?

The key provisions from Budget 2016 included...

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The tax adjustments announced in Budget 2016 were the second part of a three-year plan to reduce the income tax burden and stimulate spending.

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The package of incentives for entrepreneurs and the Knowledge Development Box were intended to encourage domestic business growth.

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Initiatives were put in place to attract multinationals to locate their global operations here in Ireland.

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Ireland's early engagement with the BEPS process showed our transparency and willingness to work with the changing international tax regime.

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Joe Tynan
Tel: +353 1 792 6399

Johanna Dehaene
Corporate Communications
Tel: +353 1 792 6547

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