Seán Ardagh (Dublin South Central, Fianna Fail)

Dublin South-Central is one of the most socially disadvantaged constituencies in the country and has a very low attendance at third level compared to the farming counties. When I hear the love-in between Deputy Johnny Brady and Deputy Rabbitte, and the Minister's comment that the increase is based on macroeconomic data and that it follows consultation with the farming bodies, I wonder why the flat rate is being increased from 4.8% to 5.2%. Fair dues to them and I hope they enjoy it.

Regarding the increase in VAT registration thresholds, I welcome the Government initiative and accept what Deputies Hogan and Rabbitte said about the regulatory burden on small business. It is quite easy for mandarins and officials, with major support in their offices, to design these forms and seek their completion on a regular basis. It is very difficult for the one man operation, assisted by a partner or spouse and working all hours to make a few bob, to do paperwork. The burden, particularly on small business people, should be reduced in whatever way possible.

There is also the question that if the exemption limit is raised too much, there may be competition with people in the VAT-registered scheme. With the current availability of SSIA money, there will be a number of new kitchens or windows being installed, or footpaths will be surfaced. There are companies that are registered, paying VAT and fully compliant, as well as companies that would be fully compliant except for the VAT issue. They definitely have a competitive advantage, which must be taken into account.

I ask to what extent that has been taken into account. Why has the exemption been set at this level? Is it because the amount involved is so minimal and it costs more to collect and administer than the amount received? Is it to help the small business person reduce the regulatory burden, as Deputy Rabbitte and others stated?

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