The United Kingdom’s Chancellor, Jeremy Hunt, will deliver a pivotal speech to Parliament that is closely watched by thousands of small businesses on Wednesday afternoon. SMEs in the country face increasing costs relating to raw materials, energy, transport, and labour, which puts them in dire situations. SMEs want long-term sustainable healthy growth that ensures the country can take care of its aging population, provide good jobs for young people, and fund valuable public services like the NHS and schools, all while ensuring economic prosperity.
Many SMEs see Mr Hunt’s upcoming budget as a tipping point, especially after a year where a cost-of-living crisis weighed heavily on consumers, households, and businesses. A rise in corporation tax coupled with the demise of the super-deduction scheme could lead to a significant economic downturn. Companies will spend an extra £52 billion annually by 2030 if the scheme is replaced by one that allows firms to qualify for 100 per cent of capital spending as tax relief.
Many SMEs seek tax relief or cuts, particularly on value-added tax (VAT), which is their main tax burden. By reducing VAT, businesses will experience lower costs and make a substantial difference for the growth of SMEs. As Mr Hunt’s plan to raise corporation tax by 6% to 25% looms, SMEs are concerned about increasing tax burdens that may impact their growth prospects adversely.
Small businesses such as Balguard Engineering, which employs 65 people and designs and installs metalwork within London, are skeptical about the upcoming budget. While Ben Woodhouse, its managing director, wants urgent measures to mitigate SMEs’ challenges, he is uncertain about the government’s commitment to supporting their long-term growth prospects.
Ultimately, SMEs are asking Mr Hunt to protect them from the continued economic pressure and not add further to their costs. As businesses battle Brexit, the COVID-19 pandemic, and rising inflation and borrowing costs, they hope that Wednesday’s spring budget will not become a make-or-break moment but instead provide relief and support for their continued prosperity.
عبدالرحمان زمین پیما
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آرمان جعفری
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