Press release
Budget 2024: Government backing business in the face of ongoing challenges
From Department of Enterprise, Trade and Employment
Published on
Last updated on
From Department of Enterprise, Trade and Employment
Published on
Last updated on
The Minister for Enterprise, Trade and Employment Simon Coveney has announced a Budget 2024 package which recognises the ongoing challenges businesses are facing. The Minister also secured approval for the Increased Cost of Business Scheme (ICOB), which is a once-off grant to benefit up to 130,000 small and medium businesses at a cost of €250 million.
Overall funding allocated to the Department of Enterprise, Trade and Employment in Budget 2024 has increased by 3.7% to €979 million. This includes a €26 million increase in capital expenditure to €584 million, and a €9 million increase for current expenditure to €395 million. The Minister has also secured agreement to spend an additional €31 million of EI and IDA Ireland’s Own Resource Income (ORI), as well as funding for a new €145 million Smart Regions Enterprise Innovation Scheme.
The Minister welcomed the range of tax measures in the Budget to assist start-ups and SMEs, including improvements to the R&D Tax Credit, a new Angel Investor Scheme with a reduced Capital Gains Tax Rate of 16%, and improvements to the EIIS. The Minister also welcomed the increases in personal income tax credits, reduction in the USC and the delay in the increase in Employer’s PRSI Contribution until October 2024.
Minister Coveney said it was a pro-business Budget:
"As a government we have supported businesses with targeted interventions and supports, particularly through the extraordinary challenges of recent years. I recognise though that those challenges haven’t gone away, including very high energy costs. For that reason we’re introducing the Increased Cost of Business Scheme which will benefit up to 130,000 Small and Medium enterprises.
"The aim of the Scheme is to provide financial support to those firms which have been most impacted by additional business costs, by providing a tiered grant equivalent to up to half business rates for this year. This will also go some way to helping businesses meet the increase in the Minimum Wage to €12.70, which is obviously an important step towards the government’s commitment to introducing a Living Wage.
"I’m really pleased too to see the introduction of a new Angel Investment Scheme. It will be a standalone relief, with a reduced Capital Gains Tax rate of 16% and will be targeted at angel investors who invest in ‘innovative’ SMEs. While the details of the scheme are being finalised, Enterprise Ireland will have a key role in certifying eligible businesses that the angel investor chooses to invest in.
"The changes to our R&D tax credits from 25% to 30% and the increase in the payment threshold to €50,000 are also really welcome for large and small businesses alike. The increase in the rate will mean that any companies in-scope will be eligible to the same value of the R&D tax credit before the implementation of the new minimum effective corporation tax rate."
New funding and advisory programmes have also been put in place to help businesses across the country as part of Budget 2024.
Minister Coveney said the new Smart Regions Enterprise Innovation Scheme will be a key driver for innovation:
"The aim of the Smart Regions Enterprise Innovation Scheme is to accelerate economic growth across all regions with a focus on enterprise development and will provide much needed investment in the regions to support innovation clusters, services to SMEs and early-stage feasibility and priming research. Project promoters can apply for the first €35 million of the funding from tomorrow when Enterprise Ireland begins accepting applications.
"We recognise that it has become challenging for businesses to find the help they need, when they need it. So today I am also announcing a new National Enterprise Hub which will include a dedicated website and phone line with a Hub Advisor to help businesses access State supports. Developed by Enterprise Ireland on behalf of the government, any business can call it for direct help in navigating the comprehensive suite of supports that are being offered to business throughout Ireland."
The department’s funding for its offices, agencies and regulatory bodies have also increased in Budget 2024 to ensure they are equipped to meet their expanded statutory mandates and responsibilities. IDA Ireland has also been given more flexibility to reinvest the income it generates into priority challenges and emerging technological developments in key sectors of the future.
Minister of State for Trade Promotion, Digital and Company Regulation, Dara Calleary, welcomed the increased funding for the Digital Services Coordinator in particular:
"Ensuring fair competition, an open, pro enterprise economy underpinned by robust regulation is necessary to meet the challenges ahead.
"Ireland will play a key role as regulation of the very large online platforms and search engines under the Digital Services Act comes into effect next year. We are taking this role seriously and indeed we’re the first Member State to designate our Digital Services Coordinator, Coimisiún na Meán, and I’m pleased that an additional €3.3 million is allocated for the Digital Services Coordinator to resource its functions.
"An additional €4.9 million will also be made available to the Competition and Consumer Protection Commission which will assume new responsibilities under competition and consumer protection, as well as related functions in data governance, digital services, and AI.
"Crucially, Budget 2024 is supporting regional enterprise development through an additional €27 million in funding to IDA regional property programme. Our enterprise agencies will continue the important work to develop and grow regional enterprises and complementing this is the €750,000 to support the nine regional programme managers continue their work under the Regional Enterprise Plans to 2024."
Minister Calleary also reminded those eligible businesses to apply for available supports:
"It’s important to remember also that notwithstanding our investment in businesses into 2024, we also have a Business User Support Scheme for Kerosene which is open until the end of this month for businesses impacted by the increase in their kerosene heating costs due to the war in Ukraine. This was a specific ask from business sectors and I strongly encourage eligible businesses to apply for this scheme before the deadline. It is easy to apply for with a minimum pay out of €500."
The department also secured an extra €3.35 million to further advance its role in developing Modern Methods of Construction.
Minister of State for Business, Employment and Retail, Neale Richmond, said Budget 2024 had delivered a big boost for the department’s regulatory agencies:
"Budget 2024 will deliver a real boost to businesses of all sizes; from an additional €9 million to the Local Enterprise Offices which are vital for small businesses across the country, to a further €3 million allocated to the Ukraine Credit Guarantee Scheme which provides low-cost loans to SMEs.
"The new Increased Cost of Business Scheme will provide welcome relief and a cash injection to shops and small businesses, many of which are at the heart of our towns and main streets across the country.
"An additional €3.1 million in funding for the Health and Safety Authority will provide for the recruitment of additional inspectors and ensure they can continue their crucial work in ensuring workplaces are safe. The Workplace Relations Commission will also benefit from €1.7 million to recruit inspectors and ensuring workplaces are compliant with workers’ rights. We are committed to ensuring that Ireland is a brilliant, safe and happy place to work and these agencies are indispensable in this regard.
"Ireland’s commitment to the European Space Agency and Ireland’s space-active industry is steadfast. Additional funding of €3.3 million is an investment that is delivers a clear return for so many Irish businesses.
"This Budget provides Irish businesses with the necessary supports to continue to grow and attract staff, while helping with the additional costs of doing business. We are proud to back business, to back workers and ensure that work pays."
Budget 2024 facilitates the funding of new programmes as well as increases the funding to existing programmes, including in the following areas.
The minimum wage will increase to €12.70 per hour. This would represent 55.1% of the hourly median wage. The government’s commitment is to introduce a living wage set at 60% of the median wage by 2026.