Michael McGrath (Cork South Central, Fianna Fail)
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To ask the Minister for Finance his plans to review the position regarding the availability of tax credits to company directors, particularly in a start-up scenario, as a measure of supporting certain enterprises; and if he will make a statement on the matter. [17066/13]

Michael Noonan (Limerick City, Fine Gael)
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I assume the Deputy is referring to the provision of a tax credit similar to the PAYE tax credit of €1,650 for individuals who start their own business. Such a measure could prove costly to the Exchequer. If 10,000 new businesses were created in 2013 the cost of the credit could be €16.5 million, potentially rising to €49.5 million in 2015 if the same number of businesses were created each year. A large portion of this cost could relate to deadweight.

It is not clear whether the introduction of such a credit for self-employed individuals would be effective, given that many new businesses are loss-making in the early stages and, as a result, the credit would be unused by many individuals. It is unclear how this tax credit would stimulate business creation, or increase levels of employment. The provision of such a tax credit would not be sufficient in its own right to encourage individuals to take up self-employment.

As the Deputy is aware, in the recent Budget I announced a 10 point tax reform plan to help small business. Many of the measures contained in this plan are available to entrepreneurs who start their own business, including a 3 year corporation tax relief for start-ups, increasing the VAT cash receipts threshold and extending the Employment and Investment Incentive and Seed Capital Scheme.