Tax relief for employers

Yawlboy

Thinking about incentives to get people back to work, you soon realise that if you are an employer there is no real incentive to increase your number of employees unless it is absolutely necessary. You try and do things with the minimum number of staff and apprentices etc are a cost you don't want to have as there is no short term benefit.

Would personal tax reliefs for owners of SME's for each employee they hire be a useful incentive. For example if you hire a person on €30k per annum you would get an increase of say 10% (€3k) in your own tax free allowance for a number of years.

The more people you have working the better off you would be, the better of the employees would be and the better off the state would be. Win-win-win or am I missing something here?

spank_inferno

Such a thing already exists.

Correct me if I'm wrong, but I think one of the prev 2 budgets introduced a employer PRSI waiver for new recruits.
I think it lasts 2 years?

relax carry on

Yawlboy wrote: »

Thinking about incentives to get people back to work, you soon realise that if you are an employer there is no real incentive to increase your number of employees unless it is absolutely necessary. You try and do things with the minimum number of staff and apprentices etc are a cost you don't want to have as there is no short term benefit.

Would personal tax reliefs for owners of SME's for each employee they hire be a useful incentive. For example if you hire a person on €30k per annum you would get an increase of say 10% (€3k) in your own tax free allowance for a number of years.

The more people you have working the better off you would be, the better of the employees would be and the better off the state would be. Win-win-win or am I missing something here?

Try this for a scheme that already exists and has existed for the last few years.

http://www.revenue.ie/en/tax/it/leaflets/it59.html

[Jackass]

Considering the OP didn't know about the system, I think Kudos are due for a very constructive suggestion.

I suppose the main point about that incentive scheme is how much incentive can you give to an employer in tax relief before the gain of more tax paying employees begins to deminish. Very difficult to judge the optimum figures I would imagine.

Yawlboy

I was aware of the PRSI scheme, however I was talking about personal tax benefits.

This would allow employers to have a little extra for themselves whilst helping reduce unemployment. They in turn could spend the extra cash which should boost the economy.

My real point here is that if people see real personal benefit in hiring extra staff then they might be more inclined to.

spank_inferno

You mean for a business owner to receive personal tax credits for hiring a member of staff, while also benefiting from the existing employer contribution waivers already in place?

Yawlboy

yes exactly that, we need to incentivise people to start and grow businesses. We should reward the ones that do.