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Government urged to cut income tax to ease Brexit pressure

Published 15/08/2016

Retail Ireland says shoppers are unnerved by the prospect of the split from Europe
Retail Ireland says shoppers are unnerved by the prospect of the split from Europe

Business chiefs have called on the Government to cut income tax but leave the minimum wage alone in order to ease the pressure posed by Brexit.

Retail Ireland, part of the Ibec lobby group, warned of deepening threats from competitors in Northern Ireland and UK online retailers in the aftermath of Britain's vote to leave the EU.

The association said shoppers are unnerved by the prospect of the split from Europe while the collapse in Sterling's value makes it harder for Irish business to compete.

It called on Finance Minister Michael Noonan to cut tax on wages, to drop plans to raise the minimum wage to 10.50 euro over four years and to create a dedicated fund to rejuvenate town centres.

Retail Ireland director Thomas Burke said: "Ireland is uniquely exposed to Brexit's chill winds.

"Consumer confidence has fallen back, after months of strong growth, and retailers say positive momentum has slowed in recent weeks.

"Sterling's sharp fall has intensified competition from Northern Ireland and UK online retailers. While domestic retailers are moving quickly to adapt to the new environment, the Government must also take decisive steps in Budget 2017."

Mr Burke said price-sensitive shoppers and intense competition are keeping prices down.

Retail Ireland urged the Government to target the domestic economy as currency fluctuations are outside their control.

The group's latest retail monitor also found trade in Dublin city centre stores is down on other areas and it blamed lower footfall because of road works, including the Luas extension.

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