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|West country plea for Chancellor to help smaller business and pensioners|
|Monday, 16 November 2015|
The Chancellor, George Osborne, should use his Autumn Statement to make tax and red-tape simpler - and fairer - for owner managed businesses and pensioners, according to the head of a Westcountry based Top 40 firm of accountants.
Matthew Lee, Managing Partner of Bishop Fleming - which has offices in Bath, Bristol, Exeter, Plymouth, Torquay, Truro, and Worcester - has issued a six-point "wish-list" for the Chancellor's Autumn Statement, which will be delivered on 25th November.
Be fair to business occupiers.
"The Chancellor's recent announcement that Business Rates will be devolved to local councils by 2020 does not touch the fundamental iniquity of this tax, that is so punitive to so many businesses, while major internet corporations get an unfair advantage", says Matthew Lee.
"He should use the Autumn Statement to announce a ‘root & branch' reform that will change how this tax is based on false property values and is uniquely linked to inflation. That will create a level playing field for our businesses, who pay more in Business Rates than any European competitor", he explained.
Be fair to the self-employed.
"For large businesses and employees, the Chancellor's ‘triple-lock' promised no increase in income tax, VAT or NI for five years: but that NI promise excluded the self-employed, who represent a growing majority of businesses", warned Mr Lee.
"Fairness dictates that Mr Osborne should extend that NI ‘Freeze' to the self-employed", he urged.
Be fair to pensioners who are "stuck with their annuities"
"The new pensions freedom should be extended to those who are now prisoners of the previous rules that forced them to buy an annuity, said Mr Lee.
"By creating a safe secondary market for annuities, and a favourable tax regime their sale, the Chancellor could free pensioners to access their capital and have greater choice over how to invest their savings", he added.
Be fair to those who need to challenge the Taxman!
"At a time when HMRC (Her Majesty's Revenue & Customs) are - by their own admission - getting so many things wrong, it is awful that the Ministry for Justice is proposing to impose fees for taxpayers to take their case to a tribunal", said Bishop Fleming's Managing Partner.
"Magna Carta promised everyone access to justice: this proposal reverses that right", he contends.
Be fair to business owners.
"Mr Osborne stunned the UK's business owners - the biggest employers and drivers of the economy - by announcing a new tax regime for dividend payments, which defies his own promise of ‘no increase in income tax', said Mr Lee.
"Most small business owners pay themselves a tiny salary, so as to maximise the funding available to their business, and then take their income from dividends on any profit they generate. That is the gamble of business ownership: you put in the hours, but only take out the money that you actually deliver", he explained.
"Without any consultation, Mr Osborne announced the end of this formula - which is already making business owners ask themselves ‘why should I continue to put in the hours and take the risks?' This sounds like an idea that was announced before it was fully considered", said Mr Lee.
"I urge the Chancellor to use his Autumn Statement to re-think this knee-jerk announcement, which could strangle his declared aim to boost the country's enterprise culture", he added.
Be brave - and cut red-tape and tax complexity.
"Every recent Chancellor has promised a ‘bonfire of red-tape': it has yet to happen", said Bishop Fleming's Matthew Lee.
"Meanwhile, the rule-book on British taxation now runs to a record 6,000+ pages, with tax law becoming ever more complex with every new Finance Act. Under the former Coalition Government, Mr Osborne created the ‘Office of Tax Simplification', which we supported by seconding one of our tax experts. We now need to see the Chancellor adopting the many recommendations of that team of experts.
"There is an urgent need to streamline the confusing array of tax reliefs and exemptions, and a simplification of tax rates", said Matthew Lee.
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