Small Businesses Ask Chancellor for Better Access to Finance
Business owners have called on the Chancellor to improve access to finance for small firms and offer tax breaks to businesses and investors in his Autumn Statement on 29 November.
The statement will outline Government spending plans between now and the next Budget and provide a strong indication of policy. Both the Federation of Small Businesses (FSB) and the Forum of Private Business (FPB) have written to George Osborne asking for a variety of measures to be considered.
Business groups’ key proposals include:
- a freeze on business rates in 2012
- due diligence rules to be relaxed on low-value bids from the Regional Growth Fund
- increased public sector procurement to take the amount awarded to small firms from the current 6.5 per cent to the Government’s 25 per cent target
- increased competition in the banking sector to free up lending
- tax breaks for private and alternative lenders and investors.
Both organisations are also calling on the Chancellor to make it easier for small firms to employ young people as youth unemployment tops one million. The FPB wants to see schools “improving employability” and the FSB would like small firms to be given a National Insurance contributions (NICs) holiday when taking on young people.
The British Chambers of Commerce (BCC), meanwhile, is calling for the current NICs holiday for some small firms to be extended to all sole traders in all regions when taking on their first employee. And one business owner would like to see corporation tax for small firms scrapped altogether or an amnesty introduced to enable small businesses to invest profits in growth.
“You are so demotivated to get into profit because the moment you do, you’re stung for corporation tax,”
said Jo Eveleigh, owner of Gloucester-based car broker Deal Drivers.
“If that money could be used to reinvest and they could police it, then that would create growth.”
“Everybody’s struggling to keep their businesses going in the hope that the clouds will clear. We’re all living on next to nothing and take very low salaries to make sure the business survives. I’m better off aiming at just making the business break even than pushing to make a profit.”
Another small-business owner, Jimmy Dance of Cornwall-based video gaming café Drink, Relax, Play, said he would like to see less money spent on free training courses for start-ups and more invested in operational businesses launching new products. He said he had been struggling to get help to launch a new coffee blend because his firm “didn’t tick the right boxes”.
“We can’t get the money to produce the finished product until we have orders. But people won’t order until they’ve seen the finished product,” he said. “Because we don’t actually make the coffee ourselves, we’re not classed as a producer and we don’t tick the right box for funding. Opportunities for investment are limited or very niche down here ― they’re aimed more at farming businesses or businesses planning to operate only in Cornwall.”