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"Business-friendly" Budget but there's more to do

22 November 2017

"Business-friendly" Budget but there's more to doSmall business groups have welcomed chancellor Philip Hammond's Autumn Budget - most notably his reforms of the business rates system, his decision to freeze the VAT threshold and new investment in infrastructure.

Mike Cherry, national chairman at the Federation of Small Businesses (FSB), described the Budget as "business-friendly" and said it would "boost confidence across the small business community".

Much of the recent lobbying by small business bodies seems to have paid off. Cherry said: "FSB presented a series of reforms to the chancellor to make the business rates system fit for the future, and we are delighted to see many taken on board to improve a tax that so badly undermines economic growth. We are particularly proud to see the elimination of the staircase tax, a victory that FSB has campaigned hard to secure over the last few months."

Dr Adam Marshall, director general of the British Chambers of Commerce (BCC), said: "While more remains to be done to reduce the impact of business rates on investment and growth, the chancellor’s decisions will lessen the impact of rate rises on hard-pressed firms in many parts of the country from next April. Chambers campaigned hard for a reduction in the relentless rises of this iniquitous tax, and will be pleased that the chancellor has listened and reduced the burden."

The chancellor also listened on the issue of reducing the VAT threshold. "1.5 million modest-earning small firms and the self-employed will be relieved that we have seen off a VAT tax grab that would have caused huge economic damage," said Mike Cherry.

Despite these positives, the British Chambers of Commerce has warned that the chancellor must do more for UK businesses in the run-up to Brexit. Adam Marshall said: "Businesses will expect greater boldness from the chancellor - and more radical support for infrastructure and investment - once a Brexit transition period is secured and the shape of a UK-EU deal becomes clearer."

Stephen Martin, director general of the Institute of Directors (IoD), also said that more needs to be done to support UK businesses: "The Chancellor dipped his toe in the water with this Budget, but failed to make a splash with business … Individually there were some positive measures, but overall, the Budget was more defined by what it omitted than what it included. Not cutting the VAT threshold is a relief, but can hardly be seen as a victory. In too many areas, this Budget simply did not rise to the occasion."

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