The Government will raise the VAT thresholds for small business, Enterprise Minister Mícheál Martin promised yesterday. The Minister was responding to the publication of a report by the Small Business Forum in Dublin Castle yesterday. The report contains recommendations aimed at assisting the small business sector.

The Government last week said it would raise the audit exemption threshold to the EU maximum of €7.3 million in company revenues in line with another of the report's recommendations.

The report includes proposals to cut the burden of regulation and taxation, to provide specialist training for small business managers. It also proposes funding to provide innovation vouchers and knowledge acquisition grants which it says could help widen access to expertise and research based knowledge amongst small businesses.

"With 97 per cent of all business in Ireland being classified as small, employing almost 800,000 people, it is obviously important to the overall vibrancy of the economy that we ensure that we are doing as much as possible at all times to support their continued growth and development," the Minister said.

Mr Martin said some of the report's recommendations had already been agreed by the Government.

"We have already agreed to increase the threshold for audit exemption to €7.3 million [ from €1.5 million]," the Minister said. It also calls for VAT thresholds to be increased, for regular seven-year reviews of regulations affecting small businesses and for curbs on local authority charges on business.

Joe Macri, Small Business Forum chairman and managing director of Microsoft Ireland, said that the environment faced by small businesses had changed significantly and that managers needed to improve their management skills if they were to sustain productivity growth. The Government will establish a Management Development Council to provide management training programmes tailored to the needs of small business, the report says.

The report also proposes to allocate €2 million in so-called innovation vouchers to small business, to be used to purchase expertise and information from "accredited knowledge providers". "For the vast majority of small businesses research and development is not relevant. Innovation, however, is very relevant" said Mr Macri. The report also proposes to audit the use of information and communication technology.