Forum of Private Business gives Chancellor 4 out of 10 for his lost opportunity Budget
The Forum of Private Business is voicing disappointment at the Chancellor’s lack of support for small businesses in today’s Budget.
Having campaigned for a greater understanding by Government of the value of the SME sector, lobbied for relief for high street businesses from draconian business rates, and having pushed for greater incentivisation for investors to back the country’s future growth businesses, Managing Director of the Forum, Ian Cass, said ‘The Chancellor relies on the five million SMEs in the UK to help him balance his books. They bring in over half the country’s revenues and provide huge numbers of jobs in locations where big business is completely absent. Yet, once again, they have lost out to the political agenda.’
The Forum welcomes the stamp duty changes, which will help first time buyers and those in the construction industry, as well as the potential of a £2.5bn fund to unlock investment in emerging UK businesses, but is concerned that small businesses may find it hard to access this funding.
The Forum’s ‘Get Britain Trading’ initiative opened businesses doors to politicians to give them first hand experience of today’s challenges in running a business.
‘We welcome today's announcement that the VAT threshold will not be reduced for the next two years, but advise against any future proposed reduction as this would bring a whole new layer of compliance and operational cost to our smaller businesses, the majority of whom will have no capacity to manage it’, argues Ian Cass.
“Despite the focus on tax avoidance and the attempts to bring digital multinationals into the UK tax structure, the Forum would like to have seen more announcements on its request for a simpler and fairer tax system in the UK.”
He added: ‘The Announcement on business rates moving from RPI to CPI indexation, no reduction in the business rate threshold, the continued support for small pubs and the unchanged corporation tax rate will be welcomed by many of our members.’
The Forum will continue to lobby for more incentivisation for investors. Whilst the feared changes to the EIS schemes were not included in the Budget, neither were any changes to increase the £2000 tax free dividend allowance to business owners, which had been high on the Forum’s wish list.
The Chancellor announced a decline in the forecasts for growth and productivity, but the Forum points to possible reasons for this.
Ian Cass said: ‘This and previous governments have consistently put measures in place that have increased the time hard-pressed owners are spending on compliance and regulation, increased the costs for these same business owners and at the same time removed many of the rewards for their entrepreneurial behaviour. That being the case is it any wonder that we see productivity flat lining?
The Forum still feels that government really doesn’t understand the SME sector and how its decisions affect the sector. If they truly did then they would be able to better support this vital part of the UK economy and help it to flourish, something which needs to be a priority for this and any other UK government.’
How well did the Chancellor do? ‘Four out of ten at best’, according to Ian Cass.