FSB warns Chancellor SMEs patience is ‘wearing thin’

The Federation of Small Businesses’ regional chair for Manchester & North Cheshire has cautioned George Osborne against announcing any further big demands on small businesses next Wednesday. 

Simon Edmondson said FSB members were looking to George Osborne to help them grow and sustain economic growth in the face of emerging global and domestic pressures, and the cumulative impact of a raft of new regulatory measures and tax burdens in consecutive Budgets.

The introduction of pension auto enrolment continues to affect small businesses, while the new Living Wage which starts next month, as well the new tax on company dividends, will hammer small firms.

“The pips are already squeaking, and in the current climate it’s crucial the Chancellor uses the Budget to reassure small firms and boost their confidence so they invest, create jobs and drive economic growth,” he said. “This means no new major challenges that drive up costs and burdens. Mr Osborne must also deliver on his promises to overhaul the business rates regime and simplify the tax system.”

FSB has led the debate for reform of the non-domestic rates (NDR) system, and while it has broadly welcomed existing plans to devolve business rates receipts to local authorities like in Greater Manchester, it says this cannot be a substitute for more far reaching reform to an outdated system.

Added Edmondson: “Ahead of the 2015 General Election, the Prime Minister and Chancellor both made unequivocal commitments to FSB members that they would make significant and fundamental changes to the business rates system.

“The current system is unresponsive to economic circumstances, and is viewed as deeply unfair by the business community. While the Chancellor pushes ahead with plans to decentralise business rates, it’s absolutely vital the opportunity to introduce a fair nationwide system is not lost.”

FSB has put forward a recommendation that would see businesses with an assessed rateable value of less than £12,000 being removed from the rating system entirely. This would free up the appeals system from high numbers of low value claims, helping to support cash-strapped local authorities. It would also lift out the smallest businesses.