‘The really big news is that the widely anticipated rise in Capital Gains Tax is not going to happen,’ says Kingston Smith W1 partner Mandy Merron, who also welcomes the extension of the 10 per cent entrepreneurs’ tax relief from one to two years.
The Forum of Private Business states that some of the measures announced ‘will directly benefit smaller firms across the UK’, including a four-year extension to HM Revenue and Custom’s Time to Pay scheme and the creation of a dedicated helpline for second-time applicants to the tax-deferral process.
The FPB also welcomed pledges to increase the amount of public contracts going to small- to medium-sized enterprises by 15 per cent, and to pay 80 per cent of public invoices within five days.
Chiming with small design groups’ long-standing complaints about public procurement, the Royal Institute of British Architects’ president Ruth Reed says, ‘The pledge to widen access to Government contracts for small businesses will be particularly welcomed by smaller practices, which are so often frustrated by the procurement process.’
Merron is enthusiastic about the planned cut in business rates for SMEs for one year from October. She says, ‘Premises is a very difficult cost to lower or avoid, so help to reduce that sort of fixed cost is really helpful.’
The video games sector has received a boost in the form of tax relief, but accountant Grant Thornton’s head of media tax Liz Brion believes the Government could have gone further.
‘It is disappointing that there is no detail on how the scheme will be implemented. Consultation on the design could take some time, delaying the benefit to the industry,’ says Brion.
She adds, ‘It is also frustrating that the video games sector was the only additional area selected to receive relief. Media sectors such as animation more than deserve a similar boost… the animation industry will need to prove that it also needs assistance to retain talent in the UK.’
Finally, Chancellor of the Exchequer Alistair Darling announced yesterday that Government-owned banks Royal Bank of Scotland and Lloyds will be distributing £94m of business loans over the next four years, with half going to SMEs.
Merron says, ‘I’ll believe that when I see it.’