Commenting on the release of today’s (3 January 2019) Fiscal Monitor, Allan Shine, Chief Executive of Kildare Chamber said,
“The €100m surplus recorded in today’s final Exchequer Returns of 2018, the first since the crash in 2008, deserves to be commended, particularly considering that a deficit had originally been budgeted.
However, we cannot ignore the challenging business environment we face as we enter 2019. There is still huge uncertainty in global markets for the year ahead and the Brexit deadline is ever closer with a formal deal still not agreed upon. Further, with increases to VAT and several other costs of doing business, there are growing concerns as to the competitiveness of Irish business, despite the best efforts of Irish entrepreneurs.
We have seen first hand in Kildare several business closures over the past 10 days. The costs of doing business continues to rise, businesses are under severe pressure with continued annual increases in minimum wage, increases in employers PRSI and the increase in the VAT rate from 9 to 13.5% will hit businesses hard over the next few months.
The year-end Exchequer Returns highlight that above profile corporate tax receipts were the source of the overall surplus. We must be mindful, particularly with the challenges that lie ahead, that these receipts are unpredictable and not guaranteed in the future. Any future increases in state expenditure must come from sustainable revenue sources arising from a more broadly-based tax system. Otherwise we risk repeating the mistakes of the past.