A dedicated minister for small and medium enterprises (SMEs), the removal of the public sector from National Minimum Wage calculations and changes to PRSI are among key priorities laid out by small business lobby group ISME.
The group has also called for representation for SMEs on the Labour Economic Forum, and for the incoming government to engage formally with employers in the sector. More than 1.1 million people are employed by small and medium sized businesses in Ireland, accounting for over half the workforce.
ISME said given the size of the SME sector it was a reasonable and sensible solution for the next taoiseach to appoint a minister for small and medium enterprise.
The group is also seeking changes to how the minimum wage is calculated, asking for public sector wages to be discounted from calculations and a cap on increases in line with consumer price inflation. ISME has argued that large increases in minimum wages reduced employment and hours worked, and could not address the cost of living crisis and difficulties in the housing market.
Will 2025 deliver breakthrough on planning so Ireland can tap its wind energy ‘gold mine’?
Remote working: ‘We see younger workers in particular saying they don’t want to come back because of the expense involved’
Silicon Valley seeks an audience at the court of Trump
With a glut of electric cars on sale for under €30,000, will Irish people make the switch?
Further changes are also needed in the personal taxation system, the group said, seeking the expansion of PRSI to the entirety of the National Minimum Wage. It is also pushing for a permanent 9 per cent VAT rate for the hospitality sector, warning the alternative was “very significant costs to the taxpayer in social welfare benefit payments”, and a reduction in VAT to 21 per cent.
At the same time, ISME said a 2 per cent PRSI rate should be applied to all earnings up to €424 per week, and 6 per cent on the balance, to reduce PRSI payments for all full-time workers earning up to €848 per week while also adequately funding the social insurance fund.
The lobby group also took aim at the legal sector, describing it as the roadblock to development of infrastructure and affordable housing, timely commercial dispute resolution and was discouraging inward investment by foreign investors. It also urged the Minister for Justice not to increase personal injuries awards.
“Ireland must not be the most expensive state in the euro zone in which to live. We should aspire to be the most affordable,” said Neil McDonnell, ISME chief executive. “This means looking critically at our standard and reduced rates of VAT, energy costs, insurance costs, legal costs and labour costs.
“Furthermore, Ireland must resource higher levels of infrastructure and housing spend, as well as address risks identified in our National Risk Assessment. This will limit expenditures elsewhere. The private sector can help if it is incentivised to do so.”
- Sign up for the Business Today newsletter and get the latest business news and commentary in your inbox every weekday morning
- Opt in to Business push alerts and have the best news, analysis and comment delivered directly to your phone
- Join The Irish Times on WhatsApp and stay up to date
- Our Inside Business podcast is published weekly – Find the latest episode here
