Feeds

Small biz groups give Darling Budget a wary sniff

Chancellor takes 'credible first step'

The Power of One Infographic

Business leaders have broadly welcomed Alistair Darling’s first Budget, but said the government still has a way to go to rebuild trust after last year's CGT debacle.

Employers’ organisation the Confederation of British Industry (CBI), which earlier this week called for an overhaul to the tax system, described Chancellor Darling's Budget as “a credible first step” by the government to “win back its enterprise credentials”.

CBI director general Richard Lambert said: “Although the anger over capital gains tax is still simmering, entrepreneurs and smaller businesses will recognise that the government has made an attempt to listen.”

However, he reckoned the Chancellor’s forecast that growth would slow from three per cent in 2007 to 1¾ to 2¼ per cent in 2008, before picking up to 2¼ to 2¾ per cent in 2009, was somewhat “optimistic”.

Lambert also warned that the impact of this Budget could lead to a tax hike that could total nearly £2bn by 2010/2011.

The Institute of Directors (IoD) agreed that: “Fiscally the Budget made a small step in the right direction”, but reckoned that the government will be forced to jack up tax revenues down the line to cover the shortfall it predicts will be left from this year’s reductions.

It also cautioned that “The Chancellor is gambling that the economy will weather the credit crunch more easily than many expect”.

The Federation for Small Businesses (FSB) said it welcomed the Budget which it described as containing “few alarms and surprises for the UK’s 4.5 million-strong small business community”.

The FSB said that the government’s decision to defer plans to change its capital gains tax, or income-shifting rules, to October this year was “welcome news”, and added that the “plans should now be abandoned permanently”.

The Institute for Fiscal Studies (IFS) echoed the CBI’s warnings about Darling’s somewhat upbeat reaction to the credit crunch crisis.

“On a number of counts, Mr Darling delivered the Budget with fingers crossed," it said.

"If the downturn is deeper than expected, if he is overoptimistic about the underlying strength of tax revenues, or if political pressure requires further giveaways, then Mr Darling or his successor may have to inflict more pain than he did yesterday.”

Relations between UK business leaders and the government have been under considerable strain in recent months.

In January Darling was forced to make a humiliating U-turn over the Treasury’s single rate CGT plans, following pressure from small business lobby groups that deeply opposed the reform. ®

Mobile application security vulnerability report

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.