Budget 2014: CBI calls on George Osborne to help SMEs access finance

The business group wants to see the government introduce an incentive, such as a capital gains tax relief, for holding individual equity holding for more than five years. It also wants to see the Seed Enterprise Investment Scheme (SEIS) made permanent.

CBI director-general John Cridland said equity finance had an important role to play but that the UK lags behind other EU countries in this area.  

“Many smaller firms say they would be more likely to use equity finance if the investment was longer-term, which is why we want a tax incentive to encourage this,” he said.

The government should also review the level of collateral held at the Bank of England for banks to access the payment system, and to ensure that forthcoming regulation of alternative finance doesn’t stifle the industry, the submission said.

Cridland added: “We need to nurture the UK’s vibrant alternative finance market and encourage even more competition in banking so that businesses can get growth capital.”

The CBI also wants to see an extensions of the Annual Investment Allowance – a tax relief on certain capital spending – beyond its 2015 deadline, and a new capital allowance for buildings to boost infrastructural investment.

“To successfully rebalance our economy we need to give businesses a leg up to invest in new equipment and to sell more of their goods and services around the world,” Cridland said.

George Osborne will deliver his 2014 Budget on 19th March.

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