In a recent survey that we conducted of our small business customers[1], a quarter of respondents said they fear that their business will go under if the economy doesn’t turn around in the next year. This could have a devastating effect on Britain, as small businesses play such an integral role in the economy, employing an estimated 13.5 million people.[2]
To survive the recession, 75% of small businesses believe that the government should be doing more to help them, but with the annual Budget coming up in April 2009 only 10% of small business owners predict that it will include measures that will have a positive impact on their businesses. So what do small businesses really need from the Budget report 2009?
Budget 2009 Small Business Wish List
1. Reduction of employers’ National Insurance contribution rate
2. Tighter government control over bank charges
3. Further deferment of the rate increase of corporation tax
4. Further measures to ensure late payments are reduced
5. Extension of VAT reduction to 15 per cent for a further 12 months
This highlights the challenges currently faced by small businesses, as they are being squeezed by larger companies extending credit terms. In such a tough economic environment, small businesses want to manage their costs more efficiently, which would explain why the reduction of employers’ National Insurance contributionrate has come out on top of the wish list.
Given the low confidence shown by small businesses, it is clear the government really needs to do more to help. It remains to be seen whether the Budget will be used as the opportunity to address their most pressing needs.
More information on the results of our small business survey can be found on our website.
Look out for more comments and insights on the results of the Budget report and how it affects small businesses on this blog.
Comments