Commercial rates and water charges should be paid by householders and the State, the business lobby organisation Isme said yesterday.
In its pre-budget submission, Isme said it was unacceptable that business was the only sector paying these charges.
With the end of the SSIA scheme coming in 2007, Isme also called on the Government to switch its contribution to the scheme to spending on infrastructure projects. "The Government has committed to spend 5 per cent of GNP on capital projects each year into the medium term. While this is more than twice the EU average, it is important to remember that most member states have already accumulated a large stock of infrastructure, and the 5 per cent target is not sufficient to fully address Ireland's infrastructural needs," said Isme chairman, Daniel Hickey.
Isme also called for an alternative energy policy with incentives for investment in other forms of energy, including wind, wave and bio-fuels. The organisation also recommended that a profit-sharing scheme for SMEs should be introduced, whereby 10 per cent of profits annually are exempt from corporation tax and allowed to accumulate in a fund for a minimum of three years for the benefit of employees. This would allow small businesses to compete for and retain employees, it said.
Tax credits on dividends should be reintroduced for owner-managers whereby the first €50,000 of dividends would be taxed at 20 per cent, Isme said.
The Government should also increase the ceiling for payment of VAT on a cash receipts basis from €635,000 to €3 million a year to improve the cashflow of many SMEs.
