Lucinda Creighton (Dublin South East, Independent) | Oireachtas source

I thank the Minister for taking this Topical Issue. I wish to raise the deeply uncompetitive environment which exists to encourage productive investment in Irish small and medium-sized enterprises, and the deeply unfair and inequitable taxation system in place for the self-employed. I genuinely believe most Irish people are not aware of the fact, and would be shocked if they knew, that an employee who earns €15,000 pays €285 in tax through PAYE, USC and PRSI whereas an employer, who has taken the risk to establish a company and all of the attendant stress and headache which goes with it, pays a total of €2,235 in taxation on the same amount of earnings. This is 684% more for the self-employed person on the exact same wage as the employee. Why is it that an employee earning €50,000 pays €14,585 in tax, while an employer pays €16,235 in taxation on the same earnings, which is 11% more? An employee on €100,000 pays €40,384 in tax whereas an employer who earns the same amount pays €42,034, which is 4% more. These are startling figures.

They send out a negative signal to the people we need to continue creating jobs and who we desperately need to grow their businesses and ensure a sustainable recovery for this country. It strikes me as quite perverse that we single out the self-employed, the people to whom politicians from all sides of this House pay lip-service on a daily basis. We talk about entrepreneurs, the need for entrepreneurship and the need for people to take a risk and go the extra mile to set up or develop a business, yet we are hitting them with punitive levels of tax. In some instances, a self-employed person pays 684% more in tax than a person who is their employee on the same wage level.

It is all very well to talk about the small business people and both Government parties did so to a significant extent in their respective manifestos before the last election, but neither party nor any other party in this House currently proposes to introduce any tax equity or tax fairness for small business people. Such a move would help them along the road and encourage them, and say to them that we do not think they are crooks and gangsters and fiddle the system but rather that we believe they are the sort of people we need in our society to create jobs and opportunities and develop our economy long into the future. I find it perplexing that the Government can claim that it supports entrepreneurs when our tax policy explicitly discriminates against them. We are exporting entrepreneurs and the people we need to invest in Irish small business. That is tragic. It is true of our jobs tax policy with PRSI and our investment policy with punitive levels of capital gains tax, which are totally out of kilter with the rest of the modern developed world. We are taxing families who want to help their children start businesses through capital acquisitions tax. It is really unfortunate and I look forward to hearing the Minister's response.

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