The Federation of Small Businesses (FSB) has called for a pro-business Budget that boosts jobs and long-term growth.
The Federations claims that the Chancellor should use the Budget to show he backs British businesses to improve job creation and drive productivity across the nations and regions of the UK.
While small business confidence has rebounded to levels seen at the start of 2016, growth prospects for small firms are falling as they face the challenges ahead.
Mike Cherry, FSB National Chairman, said: “Spring Budget 2017 is a critical moment for the Government to show it is unashamedly pro-business, and that the Chancellor recognises that small businesses are the engines of job creation.
“Spiralling labour costs are now threatening their growth ambitions and hiring intentions.
“The Employment Allowance, created under the previous administration, has been a huge success and now it is time for this Government to build on that, and help us to create the new jobs and growth that this country needs.”
Mike Cherry continued: “FSB was established to champion the interests of the self-employed. At Spring Budget 2017, our entrepreneurial culture is on the line. The Government’s announcements on self-employment will be the litmus test for how pro-business it is going to be for the rest of this Parliament.
“There are a number of ways Spring Budget 2017 and the Taylor Review could help. FSB seeks a statutory definition of self-employment, changes to the social security system so that it better reflects today’s economy, Universal Credit to be responsive to income fluctuations, and incentives to help the self-employed pay for their retirement.
“In short, we need more people to set themselves up in the business, not less. The risk these local business leaders take should be reflected in the tax system, so that we build on the 5.5 million record high level of small businesses in the UK.”
At the start of this year, small firms were expecting confirmation and details on how to comply with the Government’s plans on Making Tax Digital. Last week the HM Revenue and Customs announced further delays on key decisions including the exemption threshold and the implementation timetable.
Mike Cherry said: “We have been deeply engaged with Ministers to try to change these reforms and make them work. Originally planned for 2018, the delay in decision-making means that small business owners have no idea how they will meet their tax obligations next year.
” Spring Budget 2017 is the moment for the Chancellor to announce that the scheme will be implemented in 2020, after thorough piloting, user-testing, communication and help for those who will fall foul of any new obligations. There should also be an increase in the turnover threshold to £83,000 to match the VAT threshold, which removes those businesses that will struggle the most.
“Finally, we seek focused help and support on software and for those who are digitally excluded and therefore likely to be non-compliant. Rushing in this change just as businesses face Brexit is a headache that small business owners just don’t need.”