Family Firms Want Lower Capital Taxes

16 Sep 2021 | 08.59 am

Family Firms Want Lower Capital Taxes

Smith & Williamson/FBN report

16 Sep 2021 | 08.59 am

Four out five family businesses are likely to create new jobs in the next twelve months if there is a supportive political and economic environment, according to a survey from The Family Business Network.

The second annual National Family Business Sentiment Report, prepared in conjunction with family business advisor Smith & Williamson, says that despite the cost of Brexit and ongoing supply chain issues, 60% of Irish family-run businesses are feeling more optimistic about their ability to do business and hire new employees compared to three months ago.

Of these, 80% are likely to create new jobs within the coming year, up from 60% last November. 

High levels of CGT and CAT are seen as key obstacles to growth in the sector, as “only family businesses face a need to sell off parts of their business when transitioning management to the next generation”.

Continuing government supports for family businesses and the cost of business insurance were ranked as second and third greatest concern.

Family firms have mixed views on the future of the workplace environment, with 41% planning for a full return and another 41% anticipating a hybrid model.

Family Business network executive director John McGrane (pictured) said: “Family-run businesses are eager to play their role in supporting a jobs-led recovery that Ireland needs right now. Family firms want to hire more people, invest and support both their local and national economies.

“But this growth is contingent on a policy and economic environment which nurtures and supports home-grown family firms. Targeted reforms to capital gains tax would help unlock investment in family-owned businesses and remove the threat of families being forced to sell key parts of their business as it passes from one generation to the next.

With Ireland’s FDI-friendly tax policies under pressure, government will depend on family-owned businesses to deliver Ireland’s ambition of having 2.5 million at work by 2024.”

Smith & Williamson director Con Casey added: “The report truly highlights how vital local employers are to the Irish economy. Family business owners need support as they face serious disruption from the pandemic, the aftershocks of Brexit and inflationary pressures in the costs of doing business, undermining Ireland’s competitiveness.

“Many family business owners have stayed in their business, not wanting to hand over to the next generation until Ireland’s economy has stabilised. We hope that this report can help re-mobilise these vital businesses for growth, and help Ireland move forward efficiently to renewed economic and cultural vibrancy.”

The full report is available here.

 

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