Feargal Quinn (Independent) | Oireachtas source

I know it was never going to be easy to take ¤3.5 billion out of the economy. However, in this case the Minister, Deputy Noonan, listened to the voices that said we must prioritise jobs. He spoke about their being the lifeblood of the future. He listened and took a number of steps in that direction. He also recognised the importance of the SMEs and a great number of the steps he has taken will bring improvements in that sector. SMEs are so important that if the Minister is to succeed, it will be because he has encouraged investment in that area. One of the first steps the Minister took in this regard concerns allowing access to a percentage of one's AVC funds. I was one of the voices asking how we could encourage people to invest in Ireland and the Minister has recognised this need in taking this step. This is something that will not be a cost to the Exchequer but will bring in revenue from the investment. My fear is that we have not gone far enough in this area. I am concerned when I see so many lawyers and teachers but not enough grocers running the State. I am aware I am biased in that regard. However, grocers know that sometimes a tax rate can be reduced and income will increase. This has been done before. When Charlie McCreevy reduced the betting tax in a budget from 20% to 10%, everybody howled and said he was looking after his friends in the horse business. He came in the following year and informed us he had taken in far more money at 10% than he had at 20% and was now going to reduce the tax to 5% and take in even more. In France, restaurant tax was reduced to 5.5%, resulting in 35,000 new jobs and an increase of 10% in trade. I mention the restaurant business because the Minister has recognised how tax works in the tourist sector and has not increased taxes.

The Minister has also recognised the importance of the agrifood and film business sectors and is moving in the right direction with regard to these. However, I would like to have seen him take other steps also. I would like to have seen initiatives in the construction area. It would be possible to reduce taxes there and increase income and jobs. I would also like to have seen him do something about upward-only rents, although they may not be his baby. This is an issue the Minister responsible should grasp and do something about.

There is a danger that increasing some taxes, such as the tax on cigarettes - nobody would disagree with increasing the tax on cigarettes, and certainly not Senator Crown - will encourage smuggling and the black economy. There is some evidence that in the past year businesses have been paying less in VAT because people in the black economy do not register for it.

Tourism is a very important sector and I am delighted the Minister has maintained the reduced 9% VAT rate. We must encourage investment in all areas, but particularly in SMEs. The Minister has done that and has taken many steps in the right direction. We will never be pleased that so much money is being removed from the economy, but at least the Minister has been listening.