Seán Kyne (Fine Gael) | Oireachtas source

I move recommendation No. 1:

In page 10, between lines 5 and 6, to insert the following:

“3.The Minister shall, within 3 months of the passing of this Act, prepare and lay before the Houses of the Oireachtas a report on the merging of the USC with income tax as a means of simplifying the administrative burden of tax on businesses and organisations.”.

The Minister is welcome. In February of this year, the Irish Tax Institute warned that the tax compliance burden on businesses is compromising Ireland's competitiveness. At the annual institute dinner, at which I believe the Minister was the guest of honour, the institute's president said the complexity of our business taxes is damaging Ireland's reputation as an easy location for doing business. In terms of competitiveness, the Institute for Management Development ranked Ireland 11th out of 63 countries in 2022, which is a good score. However, Ireland achieved sixth place in 2017, so there has been some slippage. The KPMG enterprise barometer for 2023 found that more than half of respondents - 57% - expressed concern about the administrative burden attached to the Irish tax regime, particularly for smaller businesses. In the same survey, less than a quarter of respondents believed the tax regime in Ireland encourages entrepreneurship and growth. One way to address this is to explore merging USC and income tax. When USC was introduced by the late Brian Lenihan, it was as a temporary measure in the 2011 budget, which was delivered in December 2010. It was declared that our system is unduly complex and the USC was seen as some sort of simplification. Perhaps the Minister would consider the benefits or otherwise of merging the USC and income tax if he believes it would have a positive effect on the administration of business.