The scale of the challenge faced by small and medium-sized enterprises is entirely predictable given the increase in the minimum wage, the reinstatement of the hospitality sector VAT rate of 13.5 per cent, and other cost increases brought about by government policy measures. said the Irish Small and Medium Enterprises Association (Isme).
The group argues that while measures such as the recent 12% minimum wage hike were being considered, the position of small businesses and employers was not sufficiently taken into account.
Isme argued that the maintenance of the 9% rate introduced in 2020 due to the special challenges caused by the pandemic is essential for the survival of many companies in this sector, and the higher added value of last September. He strongly opposed the restoration of tax rates.
The organization said the low employer PRSI rate of 8.8 per cent should be extended to support businesses that would be adversely affected by minimum wage increases, and that future increases in the national minimum wage would be subject to a consumer cap. It insists on a series of other measures, including that it should not be exceeded. He argued that the 1% training surcharge should be suspended, given the emphasis on the price index (CPI) and the large surplus of the overall fund.
The Irish Employers and Employers' Confederation (IBEC), which includes the independent Small Business Association (SFA), will host a meeting of industry bodies on Wednesday to consider the situation facing businesses.
“You're a fool to refuse money.”
Isme chief executive Neil McDonnell welcomed the move but suggested it was premature.
“While we are frustrated that it has taken so long to recognize the problems facing small and medium-sized businesses in particular, late recognition is better than no recognition at all.” said.
His organization has again criticized the scale of the government's support package for small and medium-sized businesses, suggesting the funding available is far from addressing rising costs.
“The Government welcomes the imminent start-up of a promised €257 million support package for small employers, which is one-tenth of the public sector pay increase announced last month. “Even though small and medium-sized businesses employ around 1.4 million workers, almost four times as many workers as on the public payroll,” the organization said in a statement on Tuesday.
Detailing plans to replace the minimum wage with a national living wage, the report describes the European-wide plan to set the living wage rate at €50, which contributed to the decision to raise the minimum wage from €11.30 to €12.70 in January. The mechanism was described. Percent of average full-time earnings, or 60 percent of median full-time hourly wage – particularly affected in Ireland due to the composition of the workforce with public sector earnings and the high proportion of people employed by large or multinational companies had. distorting the numbers.
“The very high wage levels enjoyed by workers in multinational companies and public services are not matched by smaller employers. Comparing the minimum wage to these higher wages therefore fails. It’s doomed.”
In response to these comments, the Irish Congress of Trade Unions (Ictu) said that the high proportion of low-income and part-time workers in the Irish economy was actually having a depressing effect on median wages.
Laura Bambrick, the group's policy director, said it was the group's position that calculations should be based on full-time workers.
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