David Bywater, Tax Partner at KPMG, comments on the Chancellor’s Autumn Statement.
Commenting on the Chancellor’s Autumn Statement David Bywater, Tax Partner at KPMG, said:
“Despite the Chancellor making a great deal of noise today on behalf of the SME community, the announcement of a consultation of a review of the way people work will cause concern for large swathes of micro-businesses. As an estimated 4.2 million businesses that make up the UK’s 5.5 million SME community have just one employee, the outcome of the consultation could have massive tax implications for small business owners in the future.
“In general there were a number of micro-measures introduced for SMEs providing some good mood music around supporting the SME community. Softening the impact of the rates regime, providing rate relief for rural small businesses and freezing increases in fuel duty will be welcome. Saving businesses £6.7 billion over the next 5 years in the overall package of business rate reform is not a small number. Announcements of billions of pounds being spent in infrastructure and housing programmes will not just be positive in terms of helping to improve productivity, but will be extra welcome for those SMEs who are represented in the construction supply chain, providing of course that they have access to work on these infrastructure projects by supporting the large corporates.
“The Chancellor is obviously focussed on making the UK a more competitive and certain tax environment for SME businesses, not just through re-confirming the business tax roadmap heading towards the lowest corporation tax rate in the G7 industrialised nations, but also in this Autumn Statement signalling their intent to improve the R&D tax credit regime – but as they currently need EU approval to make improvements to the regime this will possibly happen post Brexit. Doubling the Export Finance regime to £5 billion of support, together with broadening the currencies covered by this support, will encourage more smaller businesses to think about how they can tap into international markets. Whilst SMEs have become far more adept at selling into overseas markets, there remains a huge amount of untapped potential in the number of SMEs who aren’t currently involved in exporting.
“It is disappointing however that the Chancellor failed to address the skills shortage with no new announcements on training or apprenticeships, which will do little to help business owners with their growth agendas and war for talent.“
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