Rajesh Agrawal, Chairman and CEO of Xendpay.com, said:
In the current economic climate, the country needs a business and entrepreneur friendly budget. While the cut in Corporation Tax is welcomed, the tax relief in certain sectors like video games, animation and high end television production seems like window dressing. There are several other sectors which need equal if not more encouragement. Small firms have limited resources and are stretched, simplification of the tax system for them will certainly be helpful. We still need to see more from the Chancellor on how he will achieve some of the things he has mentioned, like the doubling of exports. How exactly would the Enterprise Loan scheme work? The reality is that business is the only engine able to power us out of the current situation. The question is – is the Chancellor going to pile on some fuel in the shape of real help for small business, or is he content on repainting the passenger carriages and guards’ vans as usual?!
Dominic Swords, Business Economist and The National Business Awards Co-Chair of Judging, argued:
The best news for British business today is the announcement of accelerating the reductions in corporation tax: falling to 24% with immediate effect and down to 22% by 2014. This is an incentive for business to grow and encourages operation in the UK, as it gives the UK a more competitive edge over other countries such as Germany, France and the USA. This will also mean greater growth opportunities for businesses, like those we see entering the National Business Awards.
There is also welcome news for businesses around the regions, especially those with potential growth markets in modern innovation sectors such as Life Sciences, Clean Technology and Renewable Energies. Positive measures here include support for investment in high speed broadband in major cities, extension of support and tax relief through the Business Finance Partnership scheme for mid cap companies and the Enterprise Finance Guarantee Schemes. This initiative will give small and mid size businesses in these sectors greater confidence in investing in new ideas and technologies.
In addition, simplification of payroll tax schemes for micro businesses, with turnover under £77,000 will appeal to small and start up businesses, as it will ease some of the operational burden of bureaucracy for them.
Alastair Kight, Managing Director of GRITIT (www.gritit.com), reported:
I think the budget demonstrated positive news regarding the corporation tax cuts, both in the short- and long-term. This will provide additional cash for growth. It would have been good to see a reduction to 20 per cent for any company turning over up to £500,000. SME’s are the engine of the economy (producing 67% of GDP), and today’s SME is tomorrow’s larger enterprise. We need to let them grow.
Again, it’s good to see the introduction of a simplified tax system for small firms, but I don’t believe George Osborne has gone far enough. Hasn’t the time come to introduce company NI and tax contribution holidays when hiring 16-24 year olds to give them and businesses a chance to create and work on solid opportunities?
As a growing business, looking to expand into new markets, one of our main focuses for the next year will be upon employment (creating jobs). Although it's positive to see the news around one million new jobs being created, coupled with the Government’s support through enterprise loans for young people. Given that one in nine new businesses fails wouldn't the investment be better utilised in creating more robust opportunities within SME businesses that have got past the point of early failure? No one is in doubt that – as a country – we need to do all we can to ‘get the young into work’. If we don’t get it right when people are in their youth, we will create a lifelong cycle of dependency. The Chancellor must consider real incentives for companies to employ young people.