195. Deputy James O'Connor asked the Tánaiste and Minister for Finance his plans to simplify tax administration for the SME sector; and if he will make a statement on the matter. [39879/26]

The Programme for Government sets out a range of commitments to support small and medium enterprises (SMEs) and to promote innovation, economic growth and entrepreneurship, and maintaining competitiveness by way of simplification of the tax system. This is an ongoing process.

My Department continues to proactively engage with stakeholders on the simplification and modernisation of the administration of the tax code and is particularly cognisant of the impact of administration on SMEs. Most recently there has been engagement at the Cost of Doing Business Advisory Forum, which is due to report later this year.

Public consultation also provides a forum for stakeholder engagement and recently my Department and Revenue have engaged with stakeholders through a public consultation regarding a number of policy proposals on the modernisation of withholding taxes.

In relation to the administration of tax incentives for SMEs, the Deputy may be aware that a sub-committee of the Tax Administration Liaison Committee (TALC) was established by Revenue in early 2024 with the aim to examine potential opportunities to modernise and simplify access to business reliefs, in particular for SMEs. The sub-committee presented its report in June 2024, and work is ongoing to implement its recommendations.

Amongst the relevant administrative recommendations was the restructuring of Revenue’s published Tax and Duty Manual (TDM) on Relief for Investment in Corporate Trades, or the ‘Part 16 reliefs’, in order to facilitate the provision of, and access to, information to SMEs. The Part 16 reliefs comprise the Employment Investment Incentive (EII), Start-up Capital Incentive (SCI) and Start-up Relief for Entrepreneurs (SURE) which, in general, provide tax relief for risk capital investments in SMEs. The redevelopment of the TDM concluded in December 2025 with the publication of four distinct TDMs which provide clear and simplified guidance for companies that wish to raise risk capital investment and individuals who wish to avail of relief in respect of EII, SCI and SURE.

In addition to the restructuring and redevelopment of these TDMs, extensive follow-on work has commenced in relation to the review and restructure of related content on the Revenue website. This work is at an advanced stage, with updated guidance expected to be published in the coming months.

In relation to Corporation Tax, it is clear that the Corporation Tax return Form CT1 has increased significantly in length and complexity over the years to meet evolving domestic and international reporting obligations. I am advised by Revenue that they are engaging with tax practitioners and representative bodies through the TALC Collections sub-committee to begin the work of identifying how the CT1 return can be simplified and made more user-friendly. While this simplification work is important for businesses it must also be balanced against Revenue’s statutory obligations to ensure that the tax code is applied correctly and that all businesses are assessed on the same legal footing.

Efforts are underway at EU level to reduce bureaucracy and make business easier and faster in the EU by reducing administrative burdens and simplifying EU rules on direct taxation. The EU Commission has set targets to reduce the administrative burden for all businesses in particular for SMEs. Ireland is engaging constructively with these initiatives.

Both my Department and Revenue remain committed to progressing appropriate measures to simply and modernise the administration of the taxation system.