The comparatively high rate of income tax is the biggest challenge for entrepreneurs in Ireland, according to an EY survey.
Some 72 per cent cited Ireland’s personal tax rate as the single biggest “inhibiting factor” to establishing and growing a business here.
The research was conducted among 160 entrepreneurs who were all previous finalists in the EY Entrepreneur of the Year programme.
Almost two-thirds of entrepreneurs also highlighted the cost of labour and the cost of insurance in Ireland as other drawbacks to doing business in Ireland.
This was closely followed by the availability of skilled labour and tax incentives to encourage entrepreneurial activity.
“While strides have been made to foster entrepreneurship in Ireland particularly through incentives such as the recent changes to corporate tax exemption for businesses in the start-up phase, we still have a long way to go to improve Ireland’s personal tax competitiveness and compete to retain the exceptional entrepreneurial talent that is being created here,” said Kevin McLoughlin, the EY partner with responsibility for EY Entrepreneur of the Year Ireland.
Economic prosperity
“Entrepreneurs are essential to Ireland’s continued economic prosperity, yet our research is showing that more than three out of four (76 per cent ) entrepreneurs in the Republic of Ireland feel that Government is not doing enough to support entrepreneurship,” he said.
On the upside, EY's survey found nearly 60 per cent found the economic development agencies such as the IDA, Enterprise Ireland and Invest Northern Ireland helped them to do business and gain better access to European markets .
More than half also stated that Ireland’s education system and corporate tax rate were significant enablers.
The survey also indicated that more than three-quarters had increased their headcount in the last 12 months in tandem with further economic recovery, with the same proportion stating that they planned to grow their workforce in the next year.
Over half of entrepreneurs (57 per cent) said that recruiting experienced hires had been a challenge in the past year, with 43 per cent saying they have struggled to compete for talent against large multinationals.
