Brown offers little to the channel
The channel had little to get excited about as Gordon Brown announced his Pre-Budget Report last week.
Victor Dauppe, partner at accountancy firm MacIntyre Hudson, said: “In general the Pre-Budget Report was pretty dismal – nothing at all exciting for VARs I’m afraid. The accelerated capital allowance for IT was not reinstated as we had hoped, and smaller resellers might be affected by the change in corporation tax.”
However, one ray of light for the channel came in the guise of Brown attacking European Union regulations. With the huge burden of the forthcoming Waste Electrical and Electronic Equipment directive set to impose on resellers, as well as the Hazardous Waste directive and the Restriction of Hazardous Substances directive, the news that Brown will apply competitiveness tests on legislation coming from Brussels will be welcomed by many.
Other proposals that could affect the industry included extension of R&D tax credits; the establishment of a UK-wide network of innovation centres to support business start-ups; widening of VAT payment flexibility for small businesses (the annual turnover of firms eligible will be extended from the current £660,000 to £1.35m); and the extension of first-year capital allowances to 50 per cent in the year from April 2006.
Simon Sweetman, tax specialist at the Federation of Small Businesses, said: “We are pleased that all small businesses, irrespective of legal status, will now qualify for a more generous capital allowance regime. However, we felt more should have been said to emphasise the government’s programme on cutting red tape.”
Shaune Parsons, managing director of VAR Computer World Wales, said: “We have just moved into new headquarters due to expansion and the amount of red tape we have had to deal with is unbelievable.”
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