“Keep your feet on the pedal!”
With little cash for job investment the government
has made a fairly good stab with the Jobs Initiative
announced today. One strong theme is to stimulate
the tourist industry by removing barriers to visiting
and reducing costs. A different need is met by
encouraging further education and training,
and work placements through internships.
At Celtar we welcome the initiative as supporting the new government’s strategy to energise the economic recovery.
What will be of interest is who will coordinate and supply the training, and what will be the remit of the training agency FAS? Current initiatives such as Skillnets have run their course – to meet today’s challenges new bodies with new objectives should be created.
The package of measures is budgetary neutral over the period to 2014, highlights are below.
- Temporary visa waiver scheme for short-stay visitors of 14 nationalities. This initiative will make it much easier for overseas visitors – including visitors from crucial emerging markets – to come to Ireland without having to incur the trouble and expense of applying for separate visas, once they have already obtained visas for the UK.
- Abolition of the €3 per passenger travel tax as part of a deal with airlines to restore lost routes. The Air Travel Tax will be reinstated should the airlines not open additional routes and increase visitors to the country.
- Introduction of a temporary reduced rate of VAT of 9 per cent, from 13.5%, to support the tourism industry. This new temporary second reduced rate of VAT will apply to a number of tourism and entertainment related goods and services with effect from 1 July 2011 to 31 December 2013. Hairdressing and certain printed material such as brochures and newspapers will also be charged at the new rate.
- Halving lower rate of PRSI with effect from 1 July 2011until end-2013 on jobs paying up to €356 per week.
- R&D tax credit legislation to be amended to allow companies to account for the credit either above or below the line thereby giving more flexibility for companies and increasing its attractiveness for corporate taxpayers and in particular US and other foreign investors.
- The Employer PRSI charge on share based remuneration which was recently introduced has been reversed with effect from 1 January 2011.
- A national internship scheme operating for two years with 5,000 places
- Additional 3,000 places in back to education initiative
- Additional 20,900 places for training, education and upskilling
- €10 million to be provided for school works, in addition to €20 million reallocated from existing budget
- €75 million reallocated for transport projects aimed at creating at least 1,000 new jobs
- €15 million for improvements in general transport
All paid for by?
The tax reductions and expenditure measures announced are to be funded through a temporary levy on funded pension schemes and personal pension plans. The levy will apply at a rate of 0.6% on the capital value of assets under management in pension funds established in the State. It will apply for four years commencing in 2011 and is intended to raise €1.9bn over those four years.
And of course the 12.5% rate of corporation tax so important for attracting foreign direct investment is here to stay. (Sarkozy, Merkel and Co. please get off our backs!)
Celtar provides business advice to owner managers, directors and CEOs of small and medium sized businesses and not for profit organisations.
“We work with businesses that have growth potential, with entrepreneurs who value an external perspective on how their ambitions can be realised”.
Contact Billy Linehan, email@example.com