Yesterday the UK Government mde it’s Pre-Budget announcements and it seems to many that they failed to go far enough to help small businesses.
Although globally Computer Troubleshooters is a large business, as a franchise, of it’s locations consists of a SME working independantly. This means that the UK businesses are looking closely at the tax implecations.
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VAT cut by 2.5 percentage points
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45% tax rate on earnings over £150,000 from 2011
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All National Insurance to go up by 0.5% from 2011
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Economy to shrink by up to 1.25% next year
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Borrowing to hit record £118bn
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Public spending growth cut to 1.2%
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Phased increase in vehicle excise duty
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£60 Christmas gift for pensioners
For many, the budget will be a positive move in the short term, but most of us have seen recessions before and know that the short term is the least of our worries.
We will be paying for this government intervension for the rest of our lives as the borrowing has increased to record levels. Traditionally Labour governments borrow their way through their terms of office and the Conservatives pay off the national debt.
From my perspective Australia got it right by paying off most of their national debt years ago and as a result they are looking at the current financial climate in the best position. It seems to me that someone in Australia learnt the lessons of previous recessions and the boom and bust economies of the past.
If the UK Government had had the same approach then job losses, house reposessions and income tax rises for businesses and employees would be less threatening to our population.