Small businesses call to reduce rate of capital gains tax in the next Budget
The Irish SME Association (ISME) has written to the Government calling on the State to reduce its rate of capital gains tax in the next Budget.
They also say that the Organisation for Economic Co-operation and Development (OECD) plans for a standardised corporation tax rate of 15 per cent are ‘inevitable’.
The G7 and OECD countries have reached an agreement but not unanimous consensus on the key aspects of a global tax deal that seeks to introduce a minimum rate of 15 per cent.
Ireland is among a handful of countries, including Hungary that is opposed to the rate. However, Mr Donohoe has stated that Ireland cannot be a part of an international agreement on a minimum global tax rate of 15 per cent.
“Ahead of Budget 2022, and in view of the inevitable increase in corporation tax rate, ISME believes that it is an opportune time to review Ireland’s unrealistically high rate of capital gains tax,” ISME said.
The ISME Chief Executive, Neil McDonnell, suggested that setting a 15 per cent global rate “will be pointless” unless there is also agreement on what are reasonable deductions allowable against it.
ISME has advocated for a reduction in capital gains tax for some time, as outlined in its pre-Budget submission.
It appears that ISME wants a reduction in the current rate of 25 per cent but are not advocating a return to the 20 per cent rate either. Mr McDonnell believes that this would “increase the rate of capital churn in the domestic economy and would generate a permanent uplift in yield”.
People and businesses are subject to a wide range of taxes including corporation tax and capital gains tax.
Tax planning with McMahon & Co. can help reduce or remove the effect of these taxes, whether you’re a business or individual. For advice and support, please contact us.