Tax-free stock options on the way to boost Irish start-ups
The Minister Michael Noonan.
THE DEPARTMENT OF FINANCE IS LOOKING AT THE POSSIBILITY OF INTRODUCING A TAX-ADVANTAGED SHARE OPTIONS SCHEME FOR SMALL AND MEDIUM-SIZED BUSINESSES.
THE MOVE COULD HELP HOME GROWN FIRMS RETAIN KEY STAFF, IT SAID.
The Department launched a public consultation yesterday seeking views on current ‘Revenue approved’ share schemes, and the tax treatment of other remuneration in the form of shares.
The Minister for Finance, Michael Noonan, said the share options move could boost employment and economic growth.
“International research has shown that when employees share in the profits of the company, this can be effective in fostering partnership, increasing competitiveness and in helping companies to attract and retain staff in a competitive international labour market,” Mr Noonan said.
“This can then support employment and economic growth. Now is a good time to review the tax treatment of share based remuneration, including consideration of whether existing supports can be targeted more effectively.” A pre-Budget submission from the Department of Jobs last year argued that while Ireland has general tax advantaged share measures, there is little incentive for employees to take stock options over cash.
“The critical impediment is the income tax, USC and PRSI that are currently triggered on the exercise of a share option … which the employee must pay directly to Revenue with 30 days,” the submission stated.
“No cash earnings arise directly from the exercise of share option. Employees working in SMEs, whose shares are not listed on a stock exchange and where there is no readily available market, do not have the option to sell a sufficient portion of their shares to generate the cash to pay the tax like their peers in listed companies.”
The Department said the SME employee must find the cash for the tax payment from his or her own resources, unless the SME has sufficient internal funds for a share buyback.
“This places SMEs… and scaling companies at a competitive disadvantage when seeking to attract the talent to grow the business, to increase jobs and increase exports.”
The Department of Jobs unsuccessfully called for the introduction in Budget 2016 of an SME tax advantaged share options scheme designed to enable smaller and fast growth companies to recruit and retain key employees
The Department of Finance said it is now looking at the issue because the Programme for a Partnership Government includes a commitment to explore an SME share reward scheme.
As part of its analysis of the submissions made, the Department will examine the tax treatment of share-based remuneration.
It will take into account the net Exchequer benefit, potential impact on economic growth and employment, compliance with EU State Aid rules and the overall position of the public finances. The closing date for the submissions is the start of July.
“Fianna Fáil almost a centurion” now out of office but it can still pack a powerful punch?
NO GROUP IN THE NEW DÁIL AND SEANAD HAS AN EASY TASK AHEAD BUT THE CHALLENGES FOR FIANNA FÁIL ARE THE MOST COMPLEX AND PERILOUS.
Seán Lemass famously styled Fianna Fáil as a “slightly constitutional party” as it sloped towards acceptance of the Treaty which many of its members had opposed by Civil War just a few years earlier.
Were he still around today, the founding member and former leader might well call the latest Fianna Fáil manifestation “a party of power in opposition.”
The strange and noisy world of would-be ‘new politics’ did not have the space to note that the Soldiers of Destiny turned 90 last Monday.
Fianna Fáil headquarters tweeted a photograph of the serious and besuited committee that was formed at the May 1926 inaugural meeting in La Scala Theatre, Dublin.
At Leinster House, the party’s TDs and senators were more pre-occupied with a hugely changed situation as they also awaited Micheál Martin’s new frontbench.
No group in the new Dáil and Seanad has an easy task ahead but the challenges for Fianna Fáil are the most complex and perilous.
Fine Gael have to keep their own troops and the Independents on board and try to drive the implementation of ‘A Programme for a Partnership Government’, which was also launched this past week. Sinn Féin, the AAA-PBP and others on the opposition benches just have to oppose as much as they can as often as they can.
But Fianna Fáil? Well, they are determined to also be vigorously active in opposition. It’s just that they must also be careful not to, accidentally or otherwise, use their de facto power to pull the plug on this peculiar hybrid minority Coalition – for the moment, at least.
That’s a puzzling conundrum and it’s easier to take two examples from the past week in Dáil Éireann to see what we mean.
While the sharp tones of the Dáil exchanges seemed far more like ‘old politics’, something different and important did happen.
Fianna Fáil’s bill to empower the Central Bank to impose cuts in variable mortgage rates cleared its first hurdle without even a vote on Wednesday night. The Government, via Fine Gael, expressed its opposition, but lacking the numbers, it bowed to the inevitable and did not even call a division.
Let’s postpone discussion about the prospects of that mortgage measure ever getting on the statute book and the Central Bank’s determination not to use such powers. The important thing is that henceforth much more legislation will come from the Dáil, rather than solely from senior civil servants via the Government.
But while Fianna Fáil were busy legislating, they were also busy maximising Justice Minister Frances Fitzgerald’s discomfiture over the fall-out from the O’Higgins report into the garda whistleblower allegations.
The only thing here that all bar keen students might have missed is that Fianna Fáil’s outgoing justice spokesman, Niall Collins, also made it clear that they were not for pushing the Garda Commissioner, Nóirín O’Sullivan, on this one.
Thus, Fianna Fáil came well through their first week of ‘new politics’, finding the ‘two-toned’ switch with relative ease.
Is this Éamon de Valera’s party members digging into their race memory across nine decades to navigate uncharted and tricky political waters? They managed the transition to full constitutional politics
But let’s not get carried away, this process is only starting. The outcome of the water charge controversy showed that they have certainly regained their feel for populism.
Still, the “party of power in opposition” still has to maintain its own identity, while making government possible.
And Sinn Féin and the other opposition parties have not yet even taken aim at Fianna Fáil.
Tesco Ireland to phase out 22c plastic bags law in Irish stores
TESCO IS PREPARING TO PHASE OUT THEIR 22C SINGLE-USE PLASTIC BAGS IN ALL OF THEIR IRISH STORES.
The supermarket chain, which has 149 branches across the country, is hoping to become more sustainable by encouraging customers to re-use bags when they shop.
“We are in the process of gradually phasing out our 22c bags,” a spokesperson for Tesco Ireland said recently.
“The popularity of these bags has been in decline in recent years with many customers opting to re-use their bags instead.”
The plastic bag levy was introduced by the Department of the Environment in 2002 at the rate of 15c per bag, which was raised to 22c in 2007.
The fee resulted in an immediate decrease of over 90% in the number of plastic bags in circulation.
Usage fell from an estimated 328 bags per inhabitant per year when the levy was introduced to just 21 bags per capita within a single year.
In 2014, that number dropped even further to an estimated 14 bags per capita.
“We made this decision following feedback from customers and requests from local councillors to help reduce environmental pollution,” the spokesperson said.
“This move will further support less bags to landfill and complete the journey that was started many years ago with the introduction of the bag tax levy.”
Tests urged now before antibiotics are prescribed to help combat antibiotic resistance
REVIEW OF CREEPING IMMUNITY FLAGS TREND WHERE MEDICINE BEING DISHED OUT ‘LIKE SWEETS’
EXPERTS HAVE WARNED THAT RESISTANCE TO MEDICINE USED TO FIGHT INFECTIONS COULD CAUSE A BIGGER THREAT TO MANKIND THAN CANCER.
Doctors should be forced to perform diagnostic tests on patients before prescribing antibiotics which are being dished out “like sweets”, according to a review of antibiotic resistance.
Experts have warned that resistance to the drugs that are used to fight infections could cause a bigger threat to mankind than cancer.
Tackling antimicrobial resistance (AMR) is “absolutely essential”, said Lord Jim O’Neill as he published a global action plan to prevent drug-resistant infections and defeat the rising threat of so-called superbugs.
One of his proposals suggests that big pharmaceutical companies should “play or pay” – meaning they either join the search to hunt for new antibiotics or be forced to pay a fine. But those who do and find successful new treatments should be rewarded handsomely.
Another calls for better use of diagnostic tools to prevent patients being given antibiotics unnecessarily.
Harmful microbes
Health leaders from around the world have raised serious concerns about the growing resistance to antimicrobial drugs. These are the drugs which destroy harmful microbes. Antibiotics are the best known of these drugs, but there are others, such as antivirals, antimalarial drugs and antifungals.
Lord O’Neill likened AMR to “facing a growing enemy with a largely depleted armoury”.
His new report warns that if antibiotics lose their effectiveness then key medical procedures – including gut surgery, caesarean sections, joint replacements, and chemotherapy – could become too dangerous to perform.
Projections suggest that if nothing is done to control AMR, there will be 10 million deaths each year by 2050. Failure to act will also cost the world over $100 trillion in lost output between 2014 and 2050, the review suggests.
In the forward to a separate new report on AMR from the Institute and Faculty of Actuaries, Prof Dame Sally Davies, England’s chief medical officer, suggests that antibiotic resistance is responsible for about 50,000 deaths every year across Europe and the United States.
The O’Neill review, commissioned by British prime minister David Cameron in 2014, sets out a series of measures aiming to tackle the threat of AMR, including:
- Reducing the unnecessary use of antimicrobial drugs in healthcare settings;
- Monitoring and reducing superfluous use of the drugs in farming;
- Quicker progress to be made on banning or restricting antibiotics that are vital for human health from being used in animals;
- Better use of diagnostic tools to help reduce unnecessary use of the drugs;
- A global public awareness campaign about the problem of drug resistance;
- increasing the supply of new antibiotic drugs.
The report notes that the process of determining whether or not a patient needs antimicrobial drugs, especially antibiotics, has not changed for decades.
“Rapid diagnostics would be able to reduce use of antibiotics by letting doctors know if a patient has an infection and if this infection is viral or bacterial, meaning that antibiotics will only be given out to patients who need them,” the report states.
Rapid testing
Lord O’Neill, said that antibiotics are treated “like sweets” as he called on governments across the world’s richest countries to mandate that by 2020 antibiotics could only be prescribed following a rapid diagnostic test, wherever one exists.
He said that introducing this mandate will lead to advances in technology and diagnostic tools by opening a new market for them.
The review also notes that a new class of antibiotic has not been seen for decades because developing new drugs is an “unattractive” commercial proposition for pharmaceutical companies.
Lord O’Neill suggests that one way to encourage the development of new drugs would be to reward pharmaceutical companies that develop such medicines. These “market entry rewards” of about one billion US dollars each would be given to the developers of successful new drugs, subject to certain conditions.
The review also sets out how the proposals should be financed – through governments, international institutions and taxation on current antibiotic drugs. It also suggests that pharmaceutical companies who do not invest in research for AMR should be forced to pay an “antibiotic investment charge”.
Lord O’Neill, chairman of the review on AMR, said: “My review not only makes it clear how big a threat AMR is to the world, with a potential 10 million people dying each year by 2050, but also now sets out a workable blueprint for bold, global action to tackle this challenge.
“The actions that I’m setting out today are ambitious in their scope – but this is a problem which it is well within our grasp to solve if we take action now.”
Even our trees need their sleep periods
SCIENTISTS NOW SAY
Researchers in Finland and Austria have found that trees ‘sleep,’ responding to changes in light and temperature at night.
If a tree snores in the forest, does it make a sound?
Ok, trees probably don’t snore, but it turns out they might actually sleep, according to recent research.
Most living organisms respond to the variations in temperature and light that come during the nighttime. A team of researchers from Austria, Finland, and Hungary have discovered that trees might also need their shut-eye.
The researchers used laser scans and examined two different silver birch trees, one in Finland and one in Austria, to look for patterns. They used the lasers to monitor specific points on the trees and then created point cloud maps of the organisms’ movements and the surrounding forest canopies. What the researchers found is that the trees’ branches made very subtle but discernible movements at sunset, and again at sunrise.
“Our results show that the whole tree droops during night which can be seen as position change in leaves and branches,” Eetu Puttonen, of the Finnish Geospatial Research Institute, said in a press release. “The changes are not too large… but they were systematic and well within the accuracy of our instruments.”
Both the Finnish and Austrian trees slowly drooped beginning at sundown, and then gradually returned to their original position after sunrise. The researchers haven’t conclusively determined whether this is because they are capitalizing on the availability of sunlight for photosynthesis or the trees are actually following a circadian rhythm.
What is clear to the researchers, though, is that this isn’t a case of unusually high winds tossing the trees around. Both experiments were conducted under calm and clear conditions, where no wind or rain was observed.
The research team plans to use these findings to conduct future studies on the difference between trees’ water use at night and during the day, and whether their sleep patterns play a role.
“Understanding ecophysiological processes of individual trees, including their diurnal water use pattern and how this changes under water stress is becoming increasingly important for climate research,” the researchers write in a paper published in the journal Frontiers in Plant Science.
“The next step will be collecting tree point clouds repeatedly and comparing the results to water use measurements during day and night,” Dr. Puttonen said. “This will give us a better understanding of the trees’ daily tree water use and their influence on the local or regional climate.”
