Small business is being strangled by regulation according to lobby group ISME. The group, which represents small and medium-sized business says red tape is adding the equivalent of 4 per cent of sales in overheads and costing the economy jobs.

ISME says increasing levels of bureaucracy, regulations and red tape are having "a detrimental effect on companies and stifling their ability to grow".

Chief executive Mr Mark Fielding said small business owners are expected to be conversant with almost 1,000 issues set down in law and covering areas including taxation, industrial relations, auditing, environmental issues and health and safety.

"Together with the amount of legislative reading, small business are expected to complete hundreds of core forms each year to comply with the requirements of many state bodies including the Revenue Commissions, the Central Statistics Offices, the Companies Registration Office and several Government Departments," he says.

ISME says its biggest concern is over the "excessive amount of labour legislation" being "imposed" on the sector. Mr Fielding says there are no fewer than 25 Acts of the Oireachtas and eight state-sponsored bodies regulating "an already overregulated area". They include the Labour Court, the Rights Commissioner, the Conciliation service of the Labour Relations Commission, the Employment Appeals tribunal, the Equality Tribunal, the Employment Rights Enforcement Unit, the Equality Authority and the National Implementation Body.

"In a competitive environment, businesses already have enough to do," says Mr Fielding. "Every hour spent on form-filling and adhering to regulations is one less hour spent on running the business."

The group is calling for increased co-operation on sharing information by state agencies. ISME also wants the immediate introduction of a regulatory impact assessment policy on both new and existing legislation affecting small business.

"Over-regulation is stifling growth, reducing competitiveness and costing Ireland jobs," says Mr Fielding. "Irish business does not need more regulation. Ireland needs fewer, better quality, less burdensome regulation."