April 15, 2009
Small Business Could Move From England To Escape Tax
Many struggling small business owners will be considering Northern Ireland or Wales as an ideal destination, not just for a break but as a relief from the increasing costs of business tax rates, according to the Federation of Small Businesses.
The group warns that businesses in Wales and soon in Northern Ireland will receive automatic tax rate relief, whilst in England the Treasury is sitting on £400m of rates relief that could be given back to hard pressed businesses.
The relief has been automatic in Wales since 2007, but the FSB says thanks to its lobbying, Northern Ireland has pledged to introduce automatic tax relief to eligible businesses in the country within the next financial year.
However, it says businesses in England are currently denied such a system that would help ease cash flow problems and stem the tide of around 120 business closures each day. The group says this could lead to an exodus of small businesses out of England and into Wales and Northern Ireland.
Moreover, the FSB says more than half of small businesses in the UK miss out on claiming back up to £1,200 off their business tax rates because they are unaware they are entitled to do so. It says business rates are the third largest cost to small firms, after salaries and rent, yet few local authorities publicise the rate relief many small firms are entitled to.
John Wright, national chairman of the FSB says: "Small businesses deserve a break this Easter and a break from this hefty tax. We are urging the Chancellor as part of our Budget submission to look at the precedents set in Northern Ireland and Wales and allow this relief to be applied automatically.
"Next month's Budget could be make or break for small businesses. With around 120 businesses going bust a day it is crucial that immediate action is taken to sustain their cash flow. Introducing automatic rate relief will help free up vital cash."
SOURCE: FSB, 09/04/09
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