Content Starts Here
Small business and the Budget: A wish list
What small businesses want
Search: Help for small businesses
- Share your Budget views
- Tax tips and tools
When Alistair Darling steps up to the dispatch box several small businesses and their advisers will be hoping that the Chancellor has no surprises for them in his first budget. Instead, they will be listening out for details of policies announced by his predecessor in last year's budget.
"We're hoping desperately that nothing else is going to happen in the budget because there is so much going on at the moment," Richard Farnsworth, a tax director in the entrepreneurs and private companies team at accounts PricewaterhouseCoopers, says. "If anything new comes up in the budget then I think we're all going to throw our arms up in despair."
He points out that there are already 30 changes scheduled to take effect from this April. They include:
• The new 20% allowance for plant and machinery expenditure
• A new allowance of 10% for certain fixtures within buildings
• Small companies' corporation tax increase to 21% (and 22% from April 2009)
The Chancellor is expected to give details of policies that have already been announced and may also address the fall-out from the Arctic Systems case - the long-running legal battle between the Inland Revenue and a husband and wife business. Although owners Geoff and Diana Jones won their battle the Chancellor may announce changes to the treatment of taxation of family businesses.
Less is more
Richard Robinson, CEO of Tickex.com which sells tickets for live music, theatre and sports events online, hopes that the Chancellor will carry out the Government's promise to strip away some of the red tape associated with business which he sees as "key".
"Anything that can be done to simplify the ridiculous system that is VAT would be most warmly welcomed by everyone except accounting firms. Something that set out many years ago to be a 'sales tax' on consumers, has taken on a life of it's own. It seems to be something no-one ever mentions despite being a massive administrative burden."
He accepts that encouraging business people to work in small companies and start-ups is difficult but he wonders whether the government but try something "radical" such as a lower rate of income tax.
Robinson sees the change in capital gains tax as the biggest single issue for small businesses in the budget. "It really is beyond belief the government are going ahead with this despite the warnings across the board that it is the wrong thing to do. What will particularly rankle small business owners and funders is the enormous risk they take when starting a business (even a professional Venture Capitalist expects a 70% failure rate) and the reduction in potential reward with the new CGT arrangement."
He adds that the change has been brought in so quickly that some entrepreneurs who started a small business because of the attractive tax situation on exit will not have time to adapt to the new rates.
The Federation of Small Businesses (FSB), which has over 210,000 members, has already submitted its wishlist to the Treasury but is particularly keen that the Chancellor will not to go ahead with a fuel duty increase of 2p per litre, planned for April 1 2008.
As well as keeping transport costs down, the FSB would like to see the Chancellor to introduce measures to help:
• Improve productivity by increasing the size and skills of the workforce through better education
• Tackle crime against business
• Encourage sustainable business
• Create a socially responsible workforce
• Improve service infrastructure such as banking, postal service and local authorities
• Reverse the decline of the traditional High Street
• Establish a consistent approach to taxation
Farnsworth suggests that the Chancellor might announce a freeze on petrol duty but adds that he doesn't have much scope for pulling rabbits out of hats.
&qout;He's not got a lot of room for manoeuvre in terms of the headline, mainstream tax things."
The state of the UK economy means that Alistair Darling's first budget may not be a rallying cry for small businesses. But companies should examine the flurry of paper that emerges after the speech to see whether there is anything in it for them.
Useful links
HM Treasury: www.hm-treasury.gov.uk
HM Revenue & Customs: www.hmrc.gov.uk
PricewaterhouseCoopers:
http://www.pwc.co.uk/eng/issues/budget2008.html
Enter your details and start a free 30-day trial of CreditExpert's monitoring service. Privacy Policy
Get More Info
Advertisement starts
Advertisement ends
More Links Within This Section
- Budget-at-a-glance
- Speech in full
- Have your say
- Interest rates
- Last year's Budget
- Consumer news
- Features & Analysis
- Shares news
- Cash savers
- Debt: Take control
- Free brochures
- Home info packs
- Recycle
- Bank accounts
- Credit cards
- Credit reports: free
- Currency
- Cut your bills
- Energy helpline
- Free brochures
- Green energy
- Insurance
- Isas
- Loans
- Mortgages
- Property
- Save energy
- Savings
- Shares
- Small business
- A-Z of tools
- Ask the experts
- Buy-to-let
- Cars: reducing costs
- Debt advice
- Ethical finance
- Find an adviser
- Green money
- Legal
- Pensions
- Reclaim bank fees
- Saving for children
- Share your thoughts
- Student guide
- Tax
- Books
- Home office
Page Footer
Access keys
You will need to use different key combinations in order to use access keys depending on your internet browser, find out which on our accessibility page.
- (0) Navigate to Accessibility page.
- (1) Navigate to Home page.
- (2) Navigate to My email.
- (3) Navigate to My Account.
- (4) Navigate to Site Map page.
- (5) Navigate to Contact us page.
- (6) Navigate to Members channel.
- (7) Navigate to Services channel.
- (8) Navigate to News & Info channel.
- (9) Navigate to Entertainment channel.
- ([) Skip down to the Primary navigation block.
- (]) Skip down to the more links within this section block.
- (=) Bypass all navigation and jump to the content.
- (x) Text only version of this page.
CommentsPlease login to leave a comment or report a post