Responding to today’s ‘fiscal event’ and the Government’s response to FSB calls to place small businesses at the heart of plans for economic revival and growth, Daren Shaw, Cheshire and Warrington Area Leader for the Federation of Small Businesses (FSB), said:
“In this announcement the Chancellor has delivered pro-small business measures and has rightly recognised that removing taxes on jobs, investment and entrepreneurs is essential for our economy.
“Taken with the energy cost support announcement, the Truss Government is off to a good start as far as small businesses are concerned – but it’s just a start. Ministers need to be relentless in removing barriers to success, particularly given the current challenges. The Government has today signalled its determination to back small firms and we will work to ensure this continues.
“We look forward to working with councils in Cheshire and Warrington, as well as Ministers and their departments nationally, on Investment Zones and other measures to help small businesses grow and succeed.”
Looking at the detail of today’s fiscal event,’ FSB has successfully lobbied for:
National Insurance tax hikes to be reversed
“The confirmation that the NICs hikes introduced in April will be reversed is good news for small businesses and the self-employed. FSB has been campaigned tirelessly for this and it’s very welcome that the new Government heard us.
“Reversing all four NICs rises – employer, employee, self-employed and the dividend equivalent – will help small businesses and the self-employed at a crucial time. Keeping the Employment Allowance at £5,000, an increase FSB fought for, is also welcome.”
Corporation Tax increase to be scrapped
“FSB welcomes the decision to scrap the planned Corporation Tax increase. The £50,000 threshold for the main rate would have captured many small firms, so keeping tax on profits over £50,000 at 19% is welcome. This will free up funds for small businesses to invest, and mitigate the impact of continuing high inflation levels.”
Removing the IR35 tax
“The Chancellor has done the right thing in getting rid of IR35. Scrapping the poorly thought-out, unnecessary and burdensome IR35 rules that have restricted the ability of small businesses and self-employed to do the work they do is a very positive move.”
Keeping the Annual Investment Allowance at £1 million
“Keeping the Annual Investment Allowance at £1 million, rather than reducing it to £200,000, will be good news for small businesses considering significant investments.
“In order to achieve economic growth goals, for everyone’s benefit, investment and productivity must be prioritised and incentivised through the tax system. This will ultimately lead to the higher wages and more technologically advanced economy that the Government is aiming to create.”
Other key announcements:
Investment Zones
“The proposals for investment zones, where business taxes will be reduced and planning rules eased, shows welcome resolve to levelling up by being pro-business.
“Levelling-up can only succeed if small businesses in communities across the country are backed to grow, invest, and create new jobs. FSB looks forward to working with the Government, Liverpool City Region Combined Authority and the small business community to make investment zones a success, and to ensure that they work both for the small firms already working in these areas, and new small firms starting up.”
VAT Shopping
“The UK is a major destination for global tourism, and keeping incentives for international visitors is a smart move.
“The tourism sector is hugely important for small firms, and for the economy overall. International tourists contribute billions to the UK economy, supporting millions of jobs, and allowing them to continue to shop VAT-free will help maintain the flow of visitors to our tourism hotspots.”
Alcohol duty reforms scrapped
“FSB welcomes the decision to scrap planned reforms of alcohol duty. The complexity of the planned changes to alcohol duty announced earlier this year would have meant that small retailers would have had to calculate many different levels of duty based on alcohol levels, which would be very challenging to administer and properly account for.
“The news that the current system will be retained is therefore helpful and will not put small independent wine and beer shops at a disadvantage compared to larger rivals with more sophisticated systems, as would otherwise have happened.”
