The ICAI under the auspices of the CCAB-I presented oral evidence to the Commission on Taxation at its request this week. CCAB-I had previously made written submissions to the Commission.
The CCAB-I delegation stressed that coherent tax policy for Ireland should be based on the principles of being fair, sensible and dynamic. In particular:
- Building on the Government's framework document for a smart economy, the tax system should be used to incentivise scientists and other experts who can contribute to developing an innovation and export led economy.
- Ireland has been successful to date in attracting Foreign Direct Investment, but to remain competitive in this area, we have to simplify our approach to ensure international companies decide to set up their headquarters here.
- From previous experience property taxes are unlikely to be a panacea for the shortfall in Exchequer receipts. If they are to be introduced, it should be as an alternative to Stamp Duty, with recognition for Stamp Duty already paid.
By international standards, the Irish income tax take is quite low. CCAB-I acknowledges that increases will be required, but stressed that the progressive nature of our income tax system should not be stretched much further as this can only be counterproductive and unsustainable in the long term.
Noting that while the Commission is due to report in September, the very difficult Exchequer position may require tax measures in advance of that date. CCAB-I Chairman Mr Jim Aiken said that "It is of the utmost importance that Ireland retains a coherent tax strategy going forward, and CCAB-I wishes the Commission on Taxation well towards that end."