“I’m surprised by the Budget but at the same time, I’m not. It’s disappointing – there’s nothing tangible in there for small businesses but what did we expect” I’m not sure, if I think about it in the cold hard light of day, that we expected more.
“Maybe the government could have made cuts to stimulate growth. They announced an increase in National Insurance for next year so I thought Alistair Darling might announce he’d waive that.
“I look at the announcements and they’re not tangible measures for my clients. It’s all well and good having money for innovation – £435m of extra support to deliver energy efficiency measures for homes, businesses and public buildings, and a £750m fund for emerging technology and regionally important sectors – but a lot of my clients with turnover of up to £5m are not going to see that as helping them.
“The increase in the main capital allowance rate to 40 per cent isn’t bad. For example, the investment allowance that came in last year has proved popular and has encouraged clients to change their spending patterns. But it still only an allowance of £50k. I don’t think many of my clients will be rushing out to take advantage of that. If Darling increased that to £100k, it may make a difference.
“The continuation of the business payment support scheme is useful as I think that gives some people some certainty as they can manage their debt with HMRC on an ongoing basis, which helps cashflow.
“The extension of the loss carry back, which allows loss-making companies to reclaim taxes on profits made in the last three years, is good but I was hoping to see a removal of the cap of £50k. There also could have been some kind of repayable tax credit that you can cash in your losses for.
“I just would have liked to have seen a bit more innovation from the government. I think a lot of entrepreneurs will say ‘we’re the ones taking the risk yet we’ve had taper relief abolished, we knew we’d take a hit in income with a new rate of tax of 45 per cent for incomes above £150,000 from 2011, but now it’s 50 per cent and has been brought forward’. Entrepreneurs will feel they’re paying for the mistakes of the government, the regulators, the banks – whoever you think is responsible for the current economic crisis. It’s the entrepreneurs who are going to be carrying the can for that.”