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Government's SME policies criticised

Published On 2 May 2007 at 08:51:15

The Conservative Party has criticised Labour's proposed tax reforms for small and medium-sized enterprises (SMEs).

Earlier this week, there was a debate in parliament on SME taxation which, the Conservatives argue, will raise £1.2 billion from these small companies over the next two years.

Responding to the move, the Conservatives said that they would act to reduce taxes and red tape for SMEs if they were elected to power.

"Labour's tax increase will hit hard the small companies that are the backbone of our economy," shadow small business spokesman Mark Prisk explained.

"Gordon Brown has tried to buy them off with promises of higher capital allowances and R&D tax credits, but these will not benefit thousands of small businesses who won't even be eligible."

Similarly, shadow treasury minister Mark Hoban added: "We want small businesses to focus on creating wealth and not have to battle through the government's complex system of rules and reliefs.

"We will make sure that our reforms are good for companies of all sizes."

Deloitte claimed that benefits SMEs might derive from increased R&D deductions in the Budget will be "partly offset by the increase in the corporation tax rate for SMEs".

 

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