Galway businesses ‘crippled’ by taxes

Business group IBEC has warned that Galway employers are under crippling pressure from taxes, begging local authorities to reduce commercial rates.

The group has claimed that jobs are under threat from rates and asked local authorities not to decrease Local Property Tax rates in favour of increasing commercial rates.

IBEC West Director John Brennan said a fairer system of local government charges is required, because businesses in Galway account for almost half the revenue generated each year for local authorities here.

He said that with turnover down 25% since the height of the Celtic Tiger boom, businesses are continuing to suffer.

“Local business is the primary source of income for the City Council. Every year, businesses in Galway City contribute 43% or €35 million of the total local government budget putting increased pressures on local business.

“Any reduction in the Local Property Tax must not result in an increase in commercial rates in the city. Moreover, the City Council should reduce rates. A more balanced approach is needed to funding local government,” said Mr Brennan.

He described any tax on business as a “tax on employment”.

“Businesses are currently contributing 43% of the total Council budget to fund services in the city. This is at the time when rates have been held at boom time levels but their turnover is down 25%, especially for SMEs in the domestic economy.

“A fairer system for local government charges is clearly needed, one that recognises the significant contribution being made by city businesses.

“Reductions in income from the new property tax should not result in a rise in commercial rates.

Any reductions in local charges or from local government reform should be first passed on to local businesses because this money would be better spent supporting job creation in the region, particularly in the SME community,” said Mr Brennan.