A leading business group has called on George Osborne to deliver a Budget which will revolutionise trading conditions for Britain’s smaller firms.
The Forum of Private Business is arguing that the Chancellor could, at little or no expense, put in place several key measures which would radically transform the fortunes of small to medium-sized enterprises (SMEs).
In line with its recently-launched campaign, Get Britain Trading, the Forum wants to see the Government take action on crucial business issues including red tape, tax, finance and late payment.
If trading conditions for smaller businesses are drastically improved, the Forum believes, the SME sector will drive growth in the wider UK economy and provide much-needed jobs to help tackle Britain’s widespread levels of unemployment.
The not-for-profit organisation’s main Budget recommendations call on the Coalition to:
· Encourage high earners to lend to SMEs through reduced taxation. Many individuals who provide finance to smaller businesses face tax rates of up to 50% on any earnings made from the loan. Introducing a tax break for SME lending would reinvigorate the business angels network and increase competition in the market, tackling the dominance enjoyed by the banks.
• Lead the way in supporting better payment practices. The Government can do this through the procurement process for contracts within the public sector.
• Continue to pursue a review of all business regulations so SMEs spend more time developing their business and following best practice, rather than filling out compliance forms.
• Push for greater transparency and flexibility in bank lending to businesses, and, where appropriate, to ensure financial products are available at reasonable rates.
• Create a long-term strategy to simplify taxation for smaller businesses and ensure the tax system promotes, rather than hinders, growth. The focus should be on:
• Encouraging SMEs to employ through reduced National Insurance rates,
• Helping businesses become more profitable by either reducing corporation tax or cutting the cost of doing business through a reduction in inflationary pressures like fuel duty,
• Supporting non-employers in taking on their first member of staff.
Forum chief executive Phil Orford said: “This year, the Forum is calling on the Chancellor to deliver a Budget which will well and truly Get Britain Trading.
“In our submission to the Government, we are calling for a number of radical but realistic measures which would, if put in place, transform the fortunes of smaller firms across the UK.
“In line with our recently-launched Get Britain Trading campaign, we want to see some groundbreaking policies put in place to help businesses tackle persistent problems like access to finance, late payment and needless over-regulation.”
Mr Orford added: “We appreciate that some of the factors contributing to the UK’s current economic predicament are outside the Government’s control. However, many factors are not and we firmly believe there are plenty of things the Coalition could do, at no little or no cost, which would genuinely improve trading conditions for SMEs.
“Our Budget submission aims to highlight these proposals and raise awareness of the obstacles currently preventing smaller businesses from realising their potential and driving forward economic growth.”
The Forum’s submission is based on evidence provided by its members via regular research projects.
