FSB calls on Chancellor to assist business growth

The Federation of Small Businesses (FSB), Northern Ireland's largest business lobby group with over 5,000 members, has presented its Budget submission to the Treasury.

A serious concern to the FSB's members highlighted in the submission is the inspection regime for small businesses. Inspections can be extremely intrusive and costly for small firms, and the compliance burden is disproportionately heavy when considering the amount of revenue raised for the Government.

The FSB believes that Her Majesty's Revenue and Customs (HMRC) needs to review the risk assessment process for small businesses.

FSB Finance Spokesperson in Northern Ireland, John Hurson, said: "The best way for the Chancellor to achieve his policy objectives is to work with small firms to create a beneficial business climate encouraging growth and entrepreneurship.

"The FSB also calls upon the Chancellor to create a clearer and simpler tax system. Some steps towards this were taken in the Pre-Budget Report, but the small business community now needs to know how the Government is planning to take this forward. Rather than making further amendments to existing legislation, leading to inconsistencies and unintended effects that hit small businesses particularly hard, the system should be streamlined and consolidated.

"Small firms make up more than 99% of all businesses in the UK and contribute 50% of UK GDP. The tax revenue from our members funds the Government's policy priorities, such as schools and hospitals.

The FSB budget submission also includes:

• A demand that National Insurance should not be used as a method of general taxation. The FSB also firmly believes that employer payroll administration should not be used to deliver the Government's social policies. This places significant burdens on small employers.
• A suggestion for a zero rate VAT trading scheme, where VAT is only charged at the final stage of consumption where previous traders in the supply chain are all VAT registered. This would eliminate time-consuming administrative work for firms and HMRC.
• A request for a moratorium on the annual increases in the business rates multipliers to bring the tax more closely in line with lower levels elsewhere in Europe. As this tax is not profit related it can have a disproportionate effect on small firms that large companies do not experience.
• A call for increased long-term investment in the road network, just 14p of every pound raised in road taxes is spent on the roads currently.

Mr Houson added: "The FSB has always worked well with all major political parties both in Northern Ireland and the UK as a whole in demonstrating the way forward for small business taxation. We will continue to do so and we hope that the Chancellor and other policy makers will examine our proposals closely, because it is in the UK's economic interests that they do so."

(SP/GB)