There is no disputing the fact that the past couple of weeks have been one of uncertainty for our little island as confusion and lack of clarity reigned supreme following the general election as we were without government until decisions could be reached. Whilst it may have seemed that the uncertainty would continue on, decisions were eventually made and our new government came into being. Despite these changes coming into place so recently, promises and plans are already being made and put into place for some major changes which might be of benefit to you and your business.
Recently it has been suggested that there will be a massive surge towards tackling the country’s ongoing mortgage crisis with measures aimed at assisting existing homeowners and, one would hope additional measures to assist prospective homeowners. These measures would be of great benefit to workers and business owners alike who may be struggling with savings or payments.
With Small and Medium Enterprises (SMEs) beginning to form somewhat of a backbone to Irish business, accounting for just over half of all Irish businesses, it is no surprise that it has recently been reported that a newfound focus on these small businesses is said to be close to the top of the agenda for the new government. A document which formed the basis of negotiations between the Independent Alliance and Fine Gael is said to outline the dire need to make progress on the issue of credit availability for Irish SMEs.
It is reported that the Independent Alliance in conjunction with Fine Gael have signalled the need to make available €1billion in additional finance to assist Irish SMEs in initial set-up and expansion issues. Lack of competition in the banking sector in Ireland has resulted in our SMEs paying more for credit than elsewhere in Europe. This, in conjunction with the discrepancies between what large companies pay for credit and that which is paid by SMEs in Ireland, makes it increasingly difficult to not only get a small business off the ground, but to keep it running. We have spoken at length in the past about the issues associated with SMEs attempting to borrow from traditional banking lenders and also new non-traditional lenders, so this new push could be a step in the right direction for the future of business in Ireland.
It is said that the new government’s focus to tackle this issue will be on developing new alternative funding sources which will be open to SMEs from peer-to-peer lending to investment opportunities in order to reach their financing goal of €1billion. The hope is that this will stimulate competition in this sector which will in turn lead to the wider availability of funding. The draft document outlining these proposals is due to be published later in the week and should also detail a commitment to increasing the earned income tax credit from €550 to €1650 for the self-employed by 2018, another step in the right direction for small business owners in Ireland.
As always, whether you are a small or large business owner, or just starting out on your own should you require any financial or business advice please do not hesitate to contact us here at DCA Accountants where we will be happy to help.