The Government should advocate for an EU-wide Brexit mitigation fund and set up a commission to identify the impact of Brexit on each tax heading in its upcoming budget, the British Irish Chamber of Commerce has said in its pre-budget submission.
“In a world filled with challenge” the chamber recommended the State implement a series of measures as Brexit contingencies, including asking the EU for a temporary exemption from state aid rules to allow the Government to assist businesses severely affected by Brexit.
Any business with exposure to the UK should be in a position to receive State support, it added, while a marketing grant should be advanced to Irish companies with a presence in the UK.
"There's a very definite risk that there could be a bad outcome here that the UK's approach and EU's response won't deliver a deal," the chamber's director general, John McGrane, told The Irish Times.
“Equally, we’re not in the drama business, we’re working hard with others to encourage others to agree specific deal,” he added.
In its submission the chamber went beyond advocating for measures to mitigate the Brexit risk, but called on the State to retain the controversial 9 per cent VAT rate for the tourism and hospitality sector and reform a taxation measure that gives tax breaks to high paid workers.
On the reduced hospitality rate Mr McGrane said the chamber doesn’t “get the noise” seeking to have the higher rate reinstated and said the reduced tax rate allows for more employment in the sector.
He also suggested that the Special Assignee Relief Programme - a tax measure to provide tax breaks to high paid workers who have worked abroad - be lengthened to between five and 10 years, with the relief being increased to 40 per cent.
The chamber called too for a portion of corporate tax revenue to be ringfenced into the "rainy day fund" - a measure the Minister for Finance Paschal Donohoe already committed to in his summer economic statement.
"Right now, in a world filled with challenge and change, with choices and chance, future-proofing Ireland is not just about Brexit-proofing - but we should certainly not waste the challenge of Brexit as a timely, urgent and powerful catalyst for doing the right things, now," Mr McGrane said in the submission.