Budget 2022 and the National Development Plan should prioritise IT infrastructure (broadband, access to 5G etc), affordable housing and energy infrastructure to boost Ireland’s international competitiveness, according to advance findings of the latest quarterly survey of business leaders by the Institute of Directors (IoD) in Ireland.
The Director Sentiment Monitor research for Q3 2021, to be published in full later in October, also reveals that 42% of business leaders see a corporate minimum effective tax rate of 15%, recently proposed by the OECD and agreed by the G7 and due to be discussed further in October, as a threat to Ireland’s competitiveness. 37% say it is ‘too soon to say’. When asked if they believe a special dispensation may be made for smaller countries, such as Ireland, to allow their corporation rates to remain unchanged, 48% of business leaders said ‘no’, with 30% saying ‘yes’.
Furthermore, 71% of the business leaders surveyed say the Government should deliver a conservative Budget 2022 in October to prevent the economy overheating too rapidly.
Commenting on the results, Maura Quinn, Chief Executive, the Institute of Directors (IoD) in Ireland, stated:
"There are many key issues on the national and international agenda in the coming weeks, which will have potentially serious ramifications for our economy and wider society. We’ll have Budget 2022, the National Development Plan, the OECD taxation reform conference, the removal of the remaining pandemic restrictions on 22nd October, and the COP36 Climate Change Conference. In this context, our research finds that a clear majority, 71%, of business leaders would prefer a ‘conservative’ Budget to prevent the economy overheating too rapidly.
"It is clear that business leaders want the Government to focus on areas that will help ensure our future international competitiveness, with our research finding that IT infrastructure, affordable housing and energy infrastructure are the top three priority areas business leaders see as significant to boost Ireland’s international competitiveness.”
The selected key advance findings of the IoD’s Director Sentiment Monitor for Q3 2021 include:
Ireland’s competitiveness – Government priorities: When asked, ‘What are the top three areas that the Irish Government should prioritise and invest in to boost Ireland’s future international competitiveness?’ the business leaders selected as follows:
- IT infrastructure and efficiency (e.g. broadband, access to 5G, etc): 62%
- Affordable housing: 60%
- Energy infrastructure (e.g. solar, wind, etc): 46%
- Higher/further education (third level, apprenticeships etc): 35%
- Internal transportation connectivity (roads, rail, etc): 21%
- Innovation: 20%
- External transportation connectivity (air and sea links): 19%
- Rural hubs: 12%
- Business supports and schemes: 12%
- Other (please specify): 5%
(Please note for this question, respondents were given the option to select multiple responses. Therefore, each response given is a percentage of the full sample, for example, Innovation is 20% out of 100%. For this reason, the responses will not add up to 100%.)
International taxation reform – a threat: When asked, ‘Do you think the international taxation reform accord (including a corporate minimum effective tax rate of 15%) recently agreed by the G7 will present a threat to Ireland’s competitiveness if agreed with by other OECD countries?’ the respondents chose as follows:
- Yes: 42%
- No: 20%
- Too soon to say: 37%
- Don't know: 2%
International taxation reform - dispensation for smaller countries: When asked, ‘In light of the international taxation reform accord, do you believe a dispensation may be made for smaller countries, such as Ireland, to allow their corporation tax rates to remain unchanged?’ the business leaders chose as follows:
- Yes: 30%
- No: 48%
- Don't know: 22%
A ‘conservative’ Budget 2022: When asked, ‘Do you think the Government should deliver a conservative Budget in October to prevent the economy overheating too rapidly as public health restrictions are eased in the coming weeks/months?’ the respondents chose as follows:
- Yes: 71%
- No: 25%
- Don't know: 5%
The findings in this survey have been rounded up or down to the nearest decimal point.
The Director Sentiment Monitor report for Q3 2021 will be published later in October 2021.