The Family Business Network wants the government to extend the commercial rates waiver until the end of 2021 and to review the rates regime.

The organisation, which represents family businesses, also wants Capital Gains Tax cut from 33% to 20% and an immediate reduction in the VAT rate for the hospitality and tourism sector to 5%.

According to FBN Ireland, commercial rates are “a relic from the Victorian times and no longer appropriate in the digital age”. 

Executive director John McGrane (pictured) said: “The commercial rates which a local family business pays are effectively based on the ‘Retail’ valuation of its property multiplied by the ‘Annual Rate on Valuation’, as agreed by the local county council at its annual budget meeting. This system fails to effectively consider what the actual revenue is for the business or whether it has turned a profit or not.”

According to FBN, in 2019 approximately 30% or €1.5 billion of all revenue to local authorities came from commercial rates. “The current system puts town centres and local family businesses at a competitive disadvantage to out-of-town retail centres and online stores such as Amazon,” McGrane added.

In Association with

“Budget 2021 takes place in the middle of the greatest challenges facing Ireland in decades. Second only to saving lives, saving jobs should be the number one priority in the upcoming budget. Employing more than three times as many workers as foreign-owned firms and the State combined, family firms in every town across the country can become the most effective engines for economic growth but only if they’re enabled to be," McGrane stated.

“With darker economic clouds looming, now is the time for government to unleash the potential of Irish family businesses to secure a jobs-led recovery. Reducing the CGT rate to 20% is a ‘win-win’ for the exchequer because it will release new investment by local employers and create new jobs. The last time Ireland reduced the rate of CGT, the state collected even more tax because of growth in activity.

“Government must also plan for the future. That’s why family-run businesses believe the National Economic Plan being unveiled with Budget 2021 should commit to establishing a National Recovery Forum to bring together employers, employees and Government, and collectively agree the best course for our economy over the next decade.”

The organisation’s budget submission is available here.