Business leaders want us to cut income tax in 'aggressive' Brexit response

Ibec's director thinks we might need to step outside of the EU's fiscal rules in the 2017 Budget...

Business group Ibec has warned that Ireland needs to lower taxes to stay competitive in the wake of the Brexit vote.

It wants an increase in relief for entrepreneurs and investors - the group also believes that workers should earn more before entering the higher tax band.

Ibec's Policy Director Fergal O'Brien says we need to response aggressively to Brexit, rather than taking a cautious approach.

He added that it would be beneficial for Ireland to break EU fiscal rules to increase capital investment and then "ask for forgiveness" after to invest in social housing, the director told Newstalk.

"Our personal taxes are way higher than our competitors ... We need more investment as well," he continued.

The group argues that lower taxes will make work more attractive, and attract talented mobile professionals to Ireland.

Ibec says that the 26% growth figures published by the CSO on Tuesday should not impact of the Government's plans for 2017.

The group also believes that an increase in Ireland's minimum wage would hurt the country's competitiveness.

Meanwhile, former Central Bank deputy governor Stefan Gerlach has told The Irish Times that Ireland needs a contractionary budget and that the State my need to reverse tax cuts and promised spending increases.