Ibec's key budget asks and Brexit update
This morning we launched Ibec’s Budget 2019 submission. It sets out detailed proposals to manage the current period of strong growth, address key business concerns and safeguard competitiveness. We make four key points:
Running a large surplus is wise. We need to avoid over-heating the economy.
We’re too reliant on tax from a small number of companies. We need to better support indigenous firms.
We’re falling behind in higher education. €250 million extra should be allocated this year.
We must respond to US tax reform by refreshing our FDI offering and recommitting to the 12.5% tax rate.
Separately, Brexit remains a matter of acute concern. Last Thursday’s UK white paper is welcome. We now have UK proposals that the EU can actively engage with, and ones which recognise the value of comprehensive future alignment across many areas.
A letter to Ibec arrived this morning from Theresa May, setting out the merits of the UK proposals, read the full text here. The UK approach points towards a less disruptive Brexit, but big differences remain within the UK, and the EU will take issue with key elements.
In recent days, the Ibec board was in Brussels and met senior officials from Michel Barnier’s team and from the Council taskforce. It was made clear to us that the risk of a ‘no deal’ outcome within the currently agreed timeframe has risen significantly. We may need to revisit current deadlines and look at ways to extend the negotiating period. The Irish business perspective is well-understood – a default to WTO rules would be a disaster and must be avoided.
While I firmly believe a deal remains more likely than a ‘no deal’ cliff edge scenario, the final nature and route to such a deal is hard to predict. Understanding and planning for different scenarios remains crucial and we’re here to support you in any way we can. Ibec’s Brexit guide for business, produced with Accenture, is available in a new online format and can be accessed at our dedicated Brexit website.
I also include an updated tracker on Brexit policy developments.
If you have any queries or comments, please get in touch. It’s always good to hear from you.
Best wishes,
Danny McCoy
Ibec CEO
Monday, 16 July 2018