Responding to the Chancellor’s emergency statement, National Chair of the Federation of Small Businesses (FSB), Martin McTague, said: “The Chancellor is right to highlight the need for stability, following all of the political turmoil and chopping and changing which has made it virtually impossible for businesses to plan and make investment decisions.
“A key tenet of bringing stability is to deliver swiftly and without fail on the commitments which have been kept today on the small business energy support package and the reversal of the hike in National Insurance. These are vital measures to ease the acute cost of doing business crisis.
“Legislation must pass swiftly in both chambers of Parliament, today, so that cash can reach small businesses next month – this will be a lifeline for many facing a tough winter. The review to come on business and consumer energy support after six months must avoid a cliff-edge for small firms that remain impacted and vulnerable.
“The decision to de-couple those paid through dividends from the reduction in National Insurance will be a blow to many small business owners trying to keep their heads above water. Dividend taxation doesn’t just hit investors – it hits hard-working entrepreneurs with bills to pay.
“In time, as public finances allow, we would like to see the Government revisit this, along with issues such as IR35 rules, and the level at which the hiked rate of Corporation Tax kicks in.
“Small businesses want to be growing and investing, but will need economic conditions to improve and sky-high operating costs brought down in order for them to be front and centre of future economic recovery.
“There are significant recessionary pressures causing severe problems for small firms and the people who work for them – while the Chancellor has focused on reassuring markets today, the Government must combine this with pro-growth measures that support the real economy.”