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Irish urge government to include tax credit for advertising
12/09/2014
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The Association of Advertisers in Ireland (AAI), in conjunction with advertising Agency Core Media, has been pushing the Department of Finance to include a 25% tax credit for incremental advertising in the upcoming budget in an effort to return the sector to growth. The AAI's initiative has been reported in the newspaper, the Irish Independent.
Advertising spend in Ireland slumped 41% to €910m last year compared to 2007, with advertising spend per capita now 22% lower than the European average. According to a Deloitte report produced last year for Independent News & Media, RTE, Core Media and Google, for every €1 spent on advertising in the country, €5.70 is generated for the Irish economy. The report maintains that the cost to the economy of the reduced ad spend during the downturn is €17.1bn, with €3.6bn of that having been lost last year alone.
Barry Dooley, AAI Chief Executive, and Alan Cox, Core Media Chief Executive, have already held talks with the Department of Finance officials regarding the tax incentive plan, with further data due to be submitted shortly.
The cost would be €23.4m over a two-year period and the incentive would only be available for advertising spend over and above 2014 levels.
The Deloitte study found that a 1% increase in advertising results in gross domestic product per capita rising by 0.062%. It arrived at the figure as an average across 18 countries over 15 years. It argued that in Ireland's case it's more appropriate to apply the figure to gross national product (GNP) rather than GDP. Assuming a 10% increase in ad spending from a 25% tax credit, the return on investment in the Irish economy would be €1.02bn.
Source: Irish Independent
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Advertising spend in Ireland slumped 41% to €910m last year compared to 2007, with advertising spend per capita now 22% lower than the European average. According to a Deloitte report produced last year for Independent News & Media, RTE, Core Media and Google, for every €1 spent on advertising in the country, €5.70 is generated for the Irish economy. The report maintains that the cost to the economy of the reduced ad spend during the downturn is €17.1bn, with €3.6bn of that having been lost last year alone.
Barry Dooley, AAI Chief Executive, and Alan Cox, Core Media Chief Executive, have already held talks with the Department of Finance officials regarding the tax incentive plan, with further data due to be submitted shortly.
The cost would be €23.4m over a two-year period and the incentive would only be available for advertising spend over and above 2014 levels.
The Deloitte study found that a 1% increase in advertising results in gross domestic product per capita rising by 0.062%. It arrived at the figure as an average across 18 countries over 15 years. It argued that in Ireland's case it's more appropriate to apply the figure to gross national product (GNP) rather than GDP. Assuming a 10% increase in ad spending from a 25% tax credit, the return on investment in the Irish economy would be €1.02bn.
Source: Irish Independent
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