Small Business Advocate Calls for Tax Relief and Support

Craig Beaumont, executive director of the Federation of Small Businesses (FSB), has been actively engaging with government officials, including meetings with the Chancellor and Prime Minister, to advocate for small business concerns ahead of the Budget.

Beaumont stated that there is a consensus, even within the Labour party, that the current tax burden on businesses is too high. He projects that by 2028, the tax burden will reach its highest point since 1948, a period associated with low chancellor success. He stressed the need for a strategy to reduce this burden rather than increasing taxes.

He expressed optimism regarding potential measures for sole traders and high street businesses, noting encouraging messages from Shadow Chancellor John Healey. Beaumont, a former Downing Street advisor, highlighted that his members have historically felt misunderstood by Labour governments, a sentiment that drove the FSB's establishment in 1974.

"What I bring is the skill of lobbying," Beaumont said, emphasizing his role in advocating for the FSB's 200,000 members. His top priorities include increasing Small Business Rate Relief from the current £12,000 threshold to £25,000, which he estimates would exempt an additional 250,000 small firms from paying rates. He described business rates as a "horrible pernicious tax."

Another key proposal is the increase of the Employment Allowance, which helps firms reduce their annual employers' National Insurance contributions. Beaumont argues that rising employment costs are deterring small businesses from hiring, particularly younger individuals. He suggested that raising the Employment Allowance, indexed to the National Living Wage, could help recover an estimated 200,000 jobs lost due to recent increases in employers' National Insurance.

Beaumont also drew attention to the economic inactivity among older individuals, contrasting it with the focus on young people not in education, employment, or training (NEETs). He noted that 1.5 million people aged 50-64 are economically inactive due to health reasons and questioned why this demographic does not receive similar political attention.

He also voiced concerns about Business Asset Disposal Relief (BADR), which affects capital gains tax for entrepreneurs selling their businesses. While acknowledging that the main capital gains tax rates may not increase, he is worried about the current BADR rate, which has risen over time. The FSB advocates for the cancellation of the 18% BADR rate, arguing it represents double taxation on savings built up by business owners for their retirement.

Beyond tax policy, Beaumont highlighted several operational challenges faced by small businesses. These include issues with Meta shutting down small business Facebook pages erroneously, a lack of accessible support, and increasing costs for online businesses. He is also critical of recent reforms at Companies House, which require directors to verify their identity and submit detailed profit and loss accounts, describing the process as "terrible" and potentially hindering business operations.

On a more positive note, Beaumont mentioned ongoing government work to cap business-to-business payment terms at 60 days, aiming to make late payments unacceptable.

Reflecting on recent economic sentiment, Beaumont noted that the FSB's July survey indicated the lowest expectation for firm growth since 2014, describing the situation as "unprecedented" and requiring urgent solutions.

The FSB is also supporting a campaign to address the postcode lottery surrounding osteoporosis, highlighting the significant economic cost of preventable fractures, estimated at £159 million in lost productivity annually, with up to 1.5 million workdays lost.

Beaumont stated that the Mail on Sunday campaign's call for the rollout of Fracture Liaison Services (FLS) across the UK is crucial for earlier diagnosis and treatment of the disease.