Business owners are facing a ‘make or break’ time as they seek crumbs of comfort in next week’s Autumn Statement, says Steven Mason, an insolvency practitioner and senior manager at Inquesta.
He said: “Although the chancellor has played down the likelihood of tax cuts, focusing instead on tackling inflation, small businesses are still hoping for a few crumbs of comfort to help them through this difficult period.
“Almost a third of SMEs in a recent poll said high tax was a major concern. Those frustrated by such taxes remain hopeful that recent rumours about Jeremy Hunt considering a £10bn cut in business taxes come true.
“There is some reason for a slither of optimism, with the suggestion that the chancellor may have £13bn in ‘fiscal headroom’ because of stealth taxes, which is double the level forecast for the Spring Budget.
“UK manufacturers are pushing for reforms to the business tax and regulatory system. The sector wants changes to improve competitiveness and encourage research and innovation. In the Spring Budget, it was announced that loss-making research and development SMEs would be able to claim £27 for every £100 spent on R&D. SMEs would welcome a merged R&D scheme to help power innovation in the UK.
“Growth is a huge factor for businesses. The Spring Budget was said to be a budget for growth that would remove obstacles which prevent businesses from investing. However, companies are struggling with increased interest rates and spiralling costs due to inflation.
“Inflation may be falling, but this isn’t happening fast enough for many businesses.
Insolvencies in the north west rose by eight per cent in October compared to September, according to R3, the UK’s insolvency and restructuring trade body.
“The next few months may be make or break for many businesses which have limped on over the last few months. It will be interesting to see what plans, if any, the chancellor has to return the UK economy to growth and prevent a recession in 2024.”
Inquesta is an insolvency and corporate recovery practice which operates nationwide and has its head office in Radcliffe, Greater Manchester.
Chancellor Jeremy Hunt is due to present his Autumn Statement on Wednesday, November 22.