Should the Chancellor have cut the small business tax rate?

 

There were plenty of plus-points for small businesses in last week’s Autumn Statement – but perhaps one or two questions which need answering.

 

Why for instance, has the government decided to cut the main rate of corporation tax, but left the small business rate as it is?

 

Cutting the main rate to 21 per cent may well help attract more companies from overseas to the UK – a move which could create vital jobs for the economy.

 

But should the coalition not be seeking to boost growth among existing UK companies?

 

With 99 per cent of British businesses falling into the SME category, a cut to the small business rate of corporation tax may have been a wise move.

 

Small firms are continuing to struggle, despite the UK’s emergence from recession.

 

The vast majority are viable enterprises, which could thrive given the right economic conditions and levels of state support. A small tax cut could make a big difference.

 

Maybe this is one for Mr Osborne to think about ahead of his Budget in the spring.

 

Posted by the Secret Businessman