FPB piles pre-Budget pressure on Darling

Small business group the Forum of Private Business is urging chancellor Alistair Darling to cut small business taxes, reduce red tape levels and enforce better lending from the banks in his pre-Budget report this month.

The facts:

The small business lobby made the demands in its formal submission to the chancellor ahead of what is likely to be a make-or-break speech on 24 November.

Among the raft of measures outlined in the submission, the FPB says it wants VAT payments changed so small businesses are charged only for money earned and not on unpaid invoices.

It also wants small business corporation tax to be cut to 20 per cent, instead of the planned 2009 increase from 21 per cent to 22 per cent, and more commitment to regulatory reform.

Small Business Rate Relief should be applied automatically, it said; currently £200m of relief goes unclaimed each year because small firms are unaware they are eligible or miss deadlines for applications.

The demands were based on the FPB latest ‘referendum survey’ of its members, which uncovered a small business wish-list including a corporation tax cut, simplified health and safety regulations and a reduction in fuel excise duty.

In related news, shadow chancellor George Osborne, attacked both Alistair Darling and prime minister Gordon Brown for “covering up” their plans to raise taxes while hinted at tax cuts.

They said:

"The FPB…wants the government to stick by its commitment to monitor the banks' lending to small businesses," said Phil Orford, the organisation's chief executive.

"Along with tackling the burden of tax and regulation, this forms a central component of our submission to the pre-Budget report. It is important that the correct measures are put in place to support both small firms and the economy as a whole."

George Osborne said: “The truth is now coming out. First the employment minister [Tony McNulty] told us that taxes would have to rise to pay for any unfunded tax cut. Now the Chancellor has hinted that under the Prime Minister's plan, taxes would have to rise.” 

We say:

Darling and the Labour government are in a sticky position. The best way for a country to get out of recession is to spend its way out, but public finances are scant.

Tax increases would be counter-productive and unpopular, so Darling will have to borrow money to pay for any fiscal measures he announces; and that could store up yet more trouble down the line.

Why not sign up to our small business newsletter and learn more?

Rating

By News Desk  on   Nov 14,2008

Add a comment  |  Add a rating  |  Email to a friend

Keywords

pre-Budget    FPB    George Osborne    corporation tax    rate relief   

Comments