Small business taxation threatens to stifle economy
Mon, 02 Nov 2009
Any move to increase taxation on small businesses would send out the wrong messages, it has been claimed.
Commenting after both the Federation of Small Businesses (FSB) and Confederation of British Industry called for government restraint in this area, the National Federation of Enterprise Agencies has echoed the message.
George Derbyshire, chief executive of the organisation, said small firms are going to be "the engine that leads the economy out of the recession".
He said that the small business sector is where the innovation and dynamism comes from, and it is essential for the economy as a whole that this is not stifled.
Mr Derbyshire added: "Just to bang on an extra amount of corporation tax or changes in National Insurance or whatever may be on the agenda, is just sending out the wrong message - that we don't appreciate your contribution."
Firms need to be incentivised to carry on the good work they are doing, he claimed.
"A creative approach to small business, particularly on the taxation side, will do more for the economy in the long-term, because innovation will contribute towards economic growth," he added.
The FSB warned last week that raising taxes on small companies would lead to an increase in the UK unemployment rate.
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