John Beckett of Eirtight Technologies, Peter Carroll of BDO Simpson Xavier, David Lawlor of Watermark Coffee Technologies and Martin Murphy of Hewlett-Packard Ireland have their say on the Budget
John Beckett, managing director, Eirtight Technologies
JOHN BECKETT felt there were good and bad elements to Budget 2009. Yesterday, he singled out the income levy, and the increases in VAT and capital gains tax as negatives for business.
Like a lot of employers, Mr Beckett warned that the 1 per cent levy would act as a disincentive to businesses to hire new staff, as the charge would be factored into any wage bargaining and would add generally to payroll costs.
Mr Beckett's company, which is less than a year old and largely serves multinationals and big organisations, has operations in eastern Europe. He pointed out that it was already cheaper to hire staff there.
"I was pleased to see that corporation tax will be left unchanged. I was also pleased that he has increased the research and development tax incentive to 25 per cent, and that the Government is going to give ongoing support to Enterprise Ireland and Science Foundation Ireland."
He also welcomed the three-year tax remission for start-ups, but added that more should have been done for small and medium-sized businesses.
Peter Carroll, managing partner, BDO Simpson Xavier
Mr Carroll said Brian Lenihan was clearly trying to spread the burden through the levy on incomes and other measures.
The BDO Simpson Xavier managing partner broadly welcomed Budget 2009, although he had reservations about some measures and felt that others did not go far enough.
"I welcome the fact that the Minister gave clarity on the corporation tax rate," he said, referring to Mr Lenihan's pledge that the Government will not increase the 12.5 per cent charge on company profits.
"It sends out the signal that Ireland is open for business."
He also complimented the decision to give start-up companies three years remission from corporation tax, but added that more could have been done in this context, as businesses at this point in their lives are generally not in a position to contribute large amounts to the exchequer.
"It sends out the right message, but it does not go far enough," he argued.
He had a similar view of the decision to cut stamp duty on commercial property deals to 6 per cent from 9 per cent.
"He could have taken a bold step and cut it to 4 per cent."
David Lawlor, managing director, Watermark Coffee Technologies
HIS INITIAL reaction to Budget 2009 was that it was "largely unimaginative" and lacked any real measures that would help small and medium-sized business.
"The 1 per cent levy will affect wage bargaining, with workers seeking extra pay to cover that cost.
This will not help companies which have already faced large increases in their cost base as a result of escalating energy prices, combined with a more challenging trading environment.
It should have been targeted at workers earning more than €40,000 a year."
Mr Lawlor, whose business supplies equipment to coffee shops and restaurants, said that, while the increase in VAT rates will not hit him directly, it could further damage consumer confidence.
Mr Lawlor also felt that, while Brian Lenihan was able to identify the problems within the public service, he was doing very little to actually tackle them.
He hoped the measures to penalise employers for providing parking for workers would be restricted to central Dublin and not imposed on outlying business parks with poor public transport links.
Martin Murphy, managing director, Hewlett-Packard Ireland
MR MURPHY welcomed some aspects of Budget 2009, but felt it did not go far enough in tackling key issues.
He stressed it should be seen as a first step towards economic recovery and bringing in multinational investment.
"While the reduction in the number of State bodies is to be welcomed, changes to create more efficiency in the public sector have not gone far enough. I welcome continued investment in science, technology and education and the increases to the R&D tax credits and maintaining the corporate tax rates at current levels.
"However, I believe that measures to attract and retain multinationals in Ireland require strong forward thinking and more innovative measures that will assist in shaping our economic future."
Mr Murphy said that the State needed a fiveyear recovery plan, which should involve more innovative tax measures combined with increase efforts to market Ireland in emerging economies such as India, South East Asia and China.
He also said removing work permit and visa restrictions for the highly skilled would increase the attractiveness of Ireland for investment.