SMEs deem tax system as 'unfair'
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A poll carried out by the Forum of Private Business (FPB) has found that more than two thirds of owners of small and medium-sized enterprises (SMEs) believe the tax burden placed on them is unfair.
According to the poll, more than half think the tax system favours large companies.
The research has been released just ahead of the 31 January deadline submission of self-assessment forms on the HM Revenue and Customs website.
It was compiled by canvassing SME owners through the FPB’s Tax and Budget Member Panel.
Some 43 per cent of respondents said that ‘fairness’ should be the main priority for the tax system. The next priority was ‘simplicity’, which was supported by one in five smaller businesses.
In addition, 13 per cent said they wanted to see the tax system reformed to make Britain more competitive internationally. In more general terms, 45 per cent of respondents said that their tax burden was a ‘very serious’ issue for their companies.
‘Our members believe that they are bearing an unfair tax burden because of the moderate sizes of their businesses,’ said FPB spokesman Phil McCabe.
‘The complexity of the British tax system is not only time consuming and frustrating, it also puts small firms at an instant disadvantage. Big companies have the expertise and resources to understand the system and minimise their tax burden. For most of our members, hiring an outside tax consultant represents a significant cost few can afford, especially in the midst of a recession.’
‘Whichever party comes to power at the general election, we would like to see them lay the foundations of a bold new tax environment where small firms are rewarded, rather than unfairly penalised, for the huge contribution they make to the British economy,’ he added.
Readers' comments (5)
Brian Murphy | 29 Jan 2010 2:55 pm
Employers NHI is a direct tax on enterprise and must be paid even in startup situations where often profits are not being generated - also business rates which are often 6 time the domestic amount per sq M is levied.
This country is full of great ideas and enterprise which cannot be developed while being taxed like this.
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Alan Smith | 29 Jan 2010 3:10 pm
I quite agree Brian, NI is a tax on jobs, as will be the new legislation on employee pensions. Enterprise is being absolutely stifled. This problem of excessive taxation/regulation on SMEs must be addressed before it all goes tits up.
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Simon Martin | 31 Jan 2010 2:47 pm
Many of the taxes and bureaucracy on small and meduim businesses are unfair, and stifle a potential emerging enterprises/s. It should be remembered that all businesses, particularly the larger corporations, all started somewhere as a small business.
These should be freed of the burdens placed on them by antiquated tax legislation, and allowed to pay such levies on a sliding scale in relation to their business needs.
Many financial experts have suggested many differing options which are far more transparent, easily and cheaply implemented, and taking so little time and expense, provides a stimulus for a company to grow.
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Andrew Mitchell | 31 Jan 2010 7:27 pm
SMEs are targeted consistently (especially by this current government) as they have a relative lack of political leverage due to their diversity and size. It makes them an easy source of revenue as there are always more people waiting to set up in business to replace any that fail. We constantly hear about what the government is doing to create jobs - I have yet to see any results other than hot-air!
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Calvin K | 13 Feb 2010 2:06 pm
The government charge corporate tax, income tax, VAT, saving tax, council tax, fuel tax, duty, VAT error penalty, and so on. How many is actually left for the people who has created the wealth themselves? This system not only stop business to start up but also drive business away from this country. People become de-motivated. This is all a viscious cycle and the chance of recovery of this country is likely to be closed to zero. I am really confused about what is in the policy makers' brain. How can business reflect their opinion on this system?
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