23rd November 2017.

Budget Welcomed by SMEs

Relief has spread among small businesses throughout the country since Chancellor Philip Hammond released his Autumn Budget yesterday afternoon.

The new Autumn Budget has been described as a “business friendly” budget and has boosted the confidence of many small business leaders.

One of the major concerns felt by SME leaders was the proposal to lower the VAT threshold, which inspired fierce criticism from struggling small business leaders. The VAT shake-up was eventually rejected by Hammond, and the current threshold of 85,000 will now be frozen for the next two years. This should appease business leaders and allow SMEs more room for manoeuvre.

Hammond considered this reduction as a way to simplify the tax system which has been seen as over complicated. However Federation of Small Business chairman, Mike Cherry has announced a collaboration between the FSB and the Treasury to help simplify tax to prevent wasted business time.

Considering the current skills shortage in certain sectors of the UK, many policymakers were glad to see the commitmment to improving the skills of workers.

David Burch, director of policy at Essex Chambers of Commerce, welcomed the new delivery of Apprenticeships, and hoped the funds could go on to help other quality work place learning.

“The money being given to Further Education Colleges for the development of the proposed new T Levels, along with the proposed National Training Scheme focusing on digital and construction skills is also important in ensuring we have people with the right skills for the future”, Burch added.

Not all SMEs were pleased with the Chancellor’s efforts however.

Ed Molyneux, founder of financial advisory website, FreeAgent, criticised Hammond for not providing more proactive measures for SMEs. Issues such as late payment are plaguing business owners, and Molyneux wants to see legislation brought forward by government to combat it.

While many business leaders approved of the stamp duty being scrapped, many fear the consequences that this attention to housing will have on business properties.

Dan Lowe, co-founder of Fourpure Brewing Co, worries that easing the housing crisis will start to squeeze large businesses in London, and wants to see government provide more support for companies in the capital that are being forced out of the city. “A balanced approach to business relief in the city will enable London to continue to grow”, Lowe added.

The Chancellor’s Autumn Budget has helped boost confidence across the small-business community, but issues such as Brexit uncertainty and late payment continue to plague business owners. The Government will have to continue their attention to UK businesses to ensure SMEs continue to make up the backbone of the UK economy.