AN EARLIER budget would benefit taxpayers, the Irish Taxation Institute (ITI) has told a Government commission.

The ITI informed the Government’s Commission on Taxation that the budget should be brought forward and the Minister should also produce a pre-budget report, flagging proposed policy changes.

The institute’s submission points out that the current process is very short, and the late budget means that taxpayers are only getting credit certificates two to three months after the beginning of the year.

ITI president Joan O’Connor said yesterday that a pre-budget report would deliver two benefits. “Firstly it would set out the policy framework for the coming year,” she said.

“Secondly, it would allow for important practicalities like changes to tax rates, allowances and thresholds for the following tax year to be initiated from an earlier date.”

Ms O’Connor added that a report would facilitate more effective consultation with interested parties.

The ITI’s submission also warns the commission that the current research and development (RD) tax breaks are not effective in attracting enough mobile investment, or in supporting start-ups, in this area, as they are not competitive enough.

Ms O’Connor said the Government needs to rethink the matter. “Enhancements in this area should focus on a greater awareness of the RD credit and a widening of the definition of RD; it does not always happen in a laboratory.

“By virtue of the level of credit, the lack of refund for start-ups and the administrative complexity, the credit is just not attractive enough to compete with other jurisdictions. Coupled with shortcomings in the tax relief available for investment in know-how, the grounds for reform become very clear.”