Channel watchers have slammed Alistair Darling’s first pre-Budget report (PBR) for adding to the tax burden of small businesses.
Businesses were disappointed to learn last week of the chancellor’s plans to introduce supplementary business rates and changes to capital gains tax, as many are still recovering from the hikes in corporation tax announced in the last Budget.
Darling said: “From April next year, I will withdraw the capital gains tax taper relief and in its place there will be just one rate of 18 per cent ­ one of the most competitive single rates of any major economy.”
Belinda Webb, representative for the Federation of Small Businesses, said: “The PBR has come as a huge disappointment because many small businesses are still out of pocket from the decisions made in the last Budget. It does not seem to take into account the vast amount of small businesses this will affect.”
Mike Lawrence, managing director of VAR BentPenny, said: “This is a very worrying outcome. He has cut tax taper relief. How can small businesses afford any employees to run the company?
“The amount going to local councils has been cut, so small businesses will be hit very hard because they will be sucked dry.
“The entire business community will be affected apart from larger firms that can afford good lawyers. Small businesses just have to accept the changes. The situation for the UK employer is dire,” he said.
Victor Dauppe, tax principal for MacIntyre Hudson, said: “Small firms now have the predicament of whether they should sell now and pay the tax or sell after 5 April and get no relief.”
VARs hold out for news of Budget benefits